Premier Investments Limited
Annual Report 2024

Plain-text annual report

Annual Report 2024 Solomon Lew Chairman John Bryce Interim CEO (Retail) and Just Group CFO Chairman’s Report On behalf of the Premier Investments Limited (“Premier”) Board of Directors, I am pleased to present the 2024 Annual Report for the financial year ended 27 July 2024 (“FY24”). Premier has once again delivered a strong result, reaffirming the Group’s resilience in challenging times. Premier has grown significantly over the past six years – from a business delivering a Net Profit after Tax (“NPAT”) in pre-COVID FY19 of $106.8 million, to delivering an NPAT of $257.9 million in FY24, representing an increase of over 140%. Under the leadership of your Board, Premier has maintained a robust balance sheet and have rewarded shareholders with record fully franked ordinary dividends in FY24 totalling 133 cents per share, an increase of 16.67% on the prior year ordinary dividends. Over the past 5 years, Premier shareholders have been rewarded with fully franked ordinary and special dividends totalling $5.38 a share – that is over $850 million in fully franked dividends distributed to our shareholders over the past 5 years. Full year ordinary and special dividends per share (fully franked) Ordinary Special 0 30 60 90 120 150 FY22 FY23 FY24 FY21 FY20 70 80 100 114 25 16 133 Premier Investments Limited 1 Premier Retail – strong performance & operational efficiencies Premier Retail, our wholly owned retail segment, contributed Earnings Before Interest and Tax (“EBIT”) of $325.91 million, a decrease of 8.6% on a record FY23 and up 94.8% on ‘pre-COVID’ FY19. Premier Retail comprises of our seven iconic brands – Peter Alexander, Smiggle, Just Jeans, Jay Jays, Portmans, Dotti and Jacqui E. Our omni-channel customer experience allows for a seamless shopping experience, supporting customers in whichever way they choose to engage with us. Be it through our over 1,100 bricks and mortar stores across six countries, or online via our websites across four countries or through our wholesale partnership arrangements with international ‘best in class’ retail partners. The group’s strategy is always anchored on delivering value for customers in our products and shopping experience, while also maintaining a relentless focus on inventory productivity and operational efficiencies. For FY24, Premier Retail reported global sales of $1,595.3 billion, a decrease of 2.3% on a record FY23. Pleasingly, operational efficiencies largely offset inflationary pressures, with cost of doing business for the Retail segment up only 1.7% on FY23. Gross margins for the year increased 35 bps to 62.6%. Peter Alexander – powerful designer brand delivering record sales of over half a billion Peter Alexander is a unique design-led brand that continues to excite our customers and deliver year on year record results for our shareholders. The brand has cemented its position as one of the leading lifestyle and gifting brands in Australia and New Zealand for the entire family, delivering full year sales surpassing half a billion dollars for the first year, with a record $508.6 million in sales, up 6.2% on FY23 and up 105.3% on FY19. The record sales result was driven by exceptional performance across all product categories and channels. Both retail store and online channels delivered strong growth during the year, with the brand’s investment in expanding the outlet store channel delivering a broader customer base. During FY24, nine new stores were opened, and nine stores were relocated or expanded to showcase the brand’s expanded product offering. We are delighted to confirm plans to launch the Peter Alexander brand in the United Kingdom in early FY25, with the first three UK stores and dedicated UK website confirmed to open by November 2024. Smiggle – a highly efficient business primed for growth Smiggle is the ultimate destination for school essentials as well as innovative and fun products for young people. In a challenging discretionary retail environment, with the Smiggle consumer particularly exposed to increased cost of living pressures in all global markets the brand delivered FY24 global sales of $296.0 million whilst trading from 43 fewer stores at July 2024 compared to July 2019. Smiggle continues to have successful collaborations with major international studios including Disney, and sporting collaborations with the Australian Football League (AFL), to name a few. The brand remains committed to providing customers with innovative and quality products and continues to explore growth opportunities in existing markets and through the evolving wholesale channel. Apparel brands – positive momentum The Apparel Brands, consisting of Just Jeans, Jay Jays, Portmans, Dotti and Jacqui-E, delivered collective sales of $790.7 million during FY24, down 6.4% on a record FY23. Continuous improvement in product, sourcing and margin delivered improved sales and margin momentum during the second half of FY24. Premier Retail is excited to announce the launch of a new customer loyalty program across all five Apparel Brands in October 2024. The new five-brand loyalty program will build brand engagement and further encourage cross shopping between the Apparel Brands. The Apparel Brands will commence unveiling new and improved store design formats during FY25, providing customers with an enhanced in-store shopping experience. Just Jeans and Jacqui-E will unveil its new store designs in November 2024, while progress continues on new store design formats for Dotti, Portmans and Jay Jays. Chairman’s Report continued 1 Refer to page 11 of the Directors Report for a reconciliation of Premier Retail EBIT and statutory reported profit before tax for the Retail Segment. 2 Annual Report 2024 Strong omni-channel offering Each Premier Retail brand seeks to delight customers in whichever way they choose to shop, and to support this we continue to invest in people, technology and marketing to improve our world-class platforms and customer experiences. The business delivered online sales of $315.3 million in FY24, representing 19.8% of total Group sales for the year. Sales in the online channel are delivered at a significantly higher EBIT margin than the retail store channel. Significantly for each of the seven brands, the most viewed window and the largest store is the brand’s online channel. Our customers also value the Group’s more than 1,100 bricks and mortar stores in six countries. With the appropriate landlord support, opportunities exist to refresh, upgrade and or expand stores across all of Premier’s brands over the next three years as we simultaneously continue to invest in our online potential. Robust balance sheet Premier maintains a strong balance sheet with cash on hand of $409.5 million at the end of FY24. At the end of FY24, Premier’s 25.5% equity accounted investment in Breville Group Limited had a market value of $981.4 million. Premier received a total of $11.5 million in fully franked dividends from Breville during the year. At the end of FY24, Premier’s 31.4% equity accounted investment in Myer Holdings Limited had a market value of $215.3 million. Premier received a total of $9.5 million in fully franked dividends from Myer during the year. Strategic review update In August 2023, the Premier Board embarked on a strategic review of Premier Retail. The Group’s strategic review has continued to progress under the leadership of the Premier Board, supported by external advisors, UBS and ABL, and an in-house lead project team. The last 12 months have highlighted significant future opportunities for each of Peter Alexander, Smiggle and the Apparel Brands. Following Myer Holdings Limited’s proposal received in June 2024 to explore a potential combination of Myer with Premier’s Apparel Brands business, Premier has prioritised exploring this opportunity, and the value which might be created for Premier shareholders. The Board’s focus in assessing the proposal or any other strategic review outcome will be on creating shareholder value, whilst maintaining the potential and integrity of each of the businesses. Any potential transaction with Myer, or any demerger of Peter Alexander and/or Smiggle will be subject to further review and final Board approval, as well as regulatory and shareholder approval. Further information will be released when appropriate, as the work being undertaken develops. Acknowledgments Premier’s sustained, strong results are an outcome of the Board and the leadership team’s careful planning, execution and a continuous pursuit for excellence in all that we do. On a personal note, I would like to thank my remarkable fellow Directors for their valuable contribution, insights and counsel throughout the year. Our outstanding results would not be possible without our dedicated global teams. Our exceptional teams deliver day after day for our customers, our communities, and our shareholders. On behalf of all shareholders, I would like to say thank you to all of our global team members. I encourage all of our shareholders to participate in the company’s Annual General Meeting on 13 December 2024 for a further review on the Group’s performance and strategies for the future. I look forward to seeing you there. Solomon Lew Chairman and Non-Executive Director Premier Investments Limited 3 Sally Herman Non-Executive Director David M. Crean Deputy Chairman and Non-Executive Director Timothy Antonie Non-Executive Director Henry D. Lanzer AM Non-Executive Director Sylvia Falzon Non-Executive Director The Directors Solomon Lew Chairman and Non-Executive Director Andrea Weiss Non-Executive Director Michael R.I. McLeod Non-Executive Director Terrence McCartney Non-Executive Director 4 Annual Report 2024 Brand Performance Premier Retail Smiggle, delivered global sales of $296.0 million in FY24, whilst trading as a more efficient business with 309 stores trading as at July 2024, including 6 new stores opened towards the end of 2H24. Smiggle is a global brand with a presence in over 20 countries, operating through its own proprietary stores, as well as through wholesale partnerships. The brand remains committed to providing customers with innovative, quality and aspirational products that stretch the age demographic from 3 years old with the Junior ranges, to 14+ years old, with older designs. Peter Alexander, is a powerful designer brand and delivered a record sales result for the year of $508.6 million, up 6.2% on FY23. Peter Alexander’s unique design led product continues to excite customers. The creative direction of the marketing program positions the brand as one of the leading lifestyle and gifting brands catering for the entire family in Australia and New Zealand. The record sales result was driven by exceptional performance across all product categories – Womenswear; Menswear; Children’s wear, Plus-size and Gifting. Portmans delivered sales of $145.2 million in FY24. Portmans has an extremely strong and distinctive market position and is well positioned for future growth, particularly through strong growth in tailoring and desk to dinner dressing. Plans are underway for new and improved store design formats. Jay Jays delivered sales of $164.3 million in FY24, whilst trading from 5 fewer stores at July 2024, compared to July 2023. Jay Jays has a strong, distinctive and competitive market position and is well positioned for future growth, with increased investment in social media marketing to build brand engagement, improved store experiences, and the opportunity to unlock future growth through new and improved store design formats. Dotti delivered sales of $111.8 million in FY24. New volume trend programs and seasonally relevant product has resonated well with customers, presenting further opportunities for growth. Dotti has a strong, distinctive and competitive market position and is well positioned for future growth. Jacqui E delivered sales of $75.6 million in FY24. Jacqui E has an extremely strong and distinctive market position and is well positioned for future growth. The brand has a loyal customer base who trust the brand for both work and occasion dressing, and customers have responded favourably to new, seasonally relevant, high quality volume programs, presenting further growth potential in the future. Apparel Brands Our Apparel Brands (consisting of Just Jeans, Jay Jays, Portmans, Dotti and Jacqui E) delivered sales of $790.7 million in FY24. Continuous improvement in product ranges and sourcing delivered improvement in gross margins during the second half of the year. The Apparel Brands operate across 719 retail stores in Australia and New Zealand, as well as online. The trusted portfolio of apparel brands is well positioned for future growth: • New loyalty program available to customers in Australia and New Zealand across all five apparel brands set to launch in October 2024 • Optimising the store portfolio with new and improved store design formats to be unveiled in 1H25 Just Jeans, the Group’s iconic original brand, delivered sales of $293.8 million in FY24. With new ranges being well received by customers, and a new store design being unveiled in November 2024, the brand is uniquely positioned for future growth as a destination for denim. Premier Investments Limited 5 Powerful designer brand delivering record results • Record FY24 sales of $508.6 million, up 6.2% on FY23 • Sales surpassing half a billion dollars in FY24 • Peter Alexander’s unique design led product continues to excite customers. The brand has positioned itself as one of the leading lifestyle and gifting brands for the entire family throughout Australia and New Zealand • Peter Alexander’s record sales result was driven by exceptional performance across all channels and all product categories: Womens, Mens, Childrens, Plus-Size and Gift • 9 new stores were opened during FY24, and 9 existing stores were relocated or expanded during the year, significantly improving the customer experience • The Brand has a runway for further growth: – 4 new stores and 4 relocations/expansions into larger format stores confirmed to open in 1H25 – over 20 further opportunities have been identified for both new and/or larger format stores in the near term to better showcase the wider product offering that has been developed in recent years – Peter Alexander launching in the United Kingdom, with 3 stores and a UK website planned to open by November 2024 – ahead of the critical Christmas gifting trade period – In the short-term, opportunities have been identified for up to 10 new stores in the UK as part of the initial launch plans Peter Alexander Peter Alexander Sales $’M FY19 247.8 FY20 288.2 FY21 384.6 FY22 428.5 FY23 478.9 FY24 508.6 0 100 200 300 400 500 600 6 Annual Report 2024 Global brand with presence in over 20 countries • Smiggle delivered global sales of $296.0 million in FY24 • Smiggle is a unique global brand and the ultimate children’s destination for school essentials. From backpacks, water bottles and lunchboxes to pens and pencil cases, Smiggle is the original creator of all things fun, colourful and on trend • The brand’s sales result has been delivered whilst trading as a more efficient business with 309 stores trading at July 2024, including 6 newly opened stores • The brand continues to have successful global collaborations across leading film studios and sporting codes that are aligned to Smiggle’s core customers, values and philosophy • Smiggle has significant runway for further growth through its proprietary stores, as well as its evolving wholesale model: – 10+ opportunities have been identified for new stores in the near term in existing markets – Wholesale model continues to evolve • Successful partnership with Smiggle’s wholesale partner in the Middle East continues to deliver through the opening of 16 standalone stores during FY24, as well as the partner’s current successful 30+ ‘store-in-store’ arrangements • Partnership with an existing wholesale partner in Indonesia to open over 100 freestanding stores within the next 10 years, in addition to the partner’s current successful 140+ “store‑in‑store’ arrangements Smiggle FY19 FY20 FY21 FY22 FY23 FY24 0 50 100 150 200 250 300 350 250 275 300 325 350 306.5 352 309 256.3 209.6 261.2 319.8 296.0 Smiggle Sales ($’M) Smiggle Stores Smiggle Global Sales $’M FY20, FY21 & FY22 impacted by COVID lockdowns and school closures Premier Investments Limited 7 Omni-channel Online Sales Growth • Premier’s strategy is to delight customers however they choose to engage and shop, whether this is in-store or online • Online sales of $315.3 million, contributing 19.8% of total FY24 sales • Online channel delivering compounding annual growth of 16.3% over the past 5 years • For each of the seven brands the most viewed window and the largest store is the brand’s online channel • The Online channel continues to deliver significantly higher EBIT margin than the retail store network providing significant operating leverage for future growth • Customers continue to value the Group’s more than 1,160 bricks and mortar stores across six countries. With the appropriate landlord support, opportunities exist for new stores and to refresh, upgrade and/or expand existing stores across all brands Delighting customers however they choose to shop Online Sales ($’M) FY20, FY21 & FY22 impacted by COVID lockdowns Online sales as % of Total Sales Online Sales CAGR +16.3% over 5 years 0 50 100 150 200 250 300 350 350 400 FY19 FY20 FY21 FY22 FY23 FY24 148.2 220.5 297.5 340.1 324.7 315.3 11.7% 18.1% 20.9% 22.7% 19.8% 19.8% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% 8 Annual Report 2024 Responsible Business Practices Build Trust & Deepen Our Relationships We are proud to share highlights from our FY24 work program. People Engaging our 10,000+ global team We aim to create an environment that focuses on engagement – ensuring our people strive for excellence while prioritising their wellbeing Building retail careers We are proud to internally promote our team members across our store network, support office and DC Investing in our people In addition to our existing learning and development program, this year we piloted a new mental health first aid training initiative Partners Ethical Sourcing Living wage progress We completed or made progress on all Living Wage commitments Grievance helpline We rolled out the Amader Katha grievance helpline in all factories in Bangladesh Supporting injured workers We became a signatory of the Employment Injury Insurance Scheme Community Breast cancer fund raising We supported the National Breast Cancer Foundation, with our team raising over $39,000 in FY24, and over $200,000 over the course of our fundraising partnership Clothing donation We donated over 28,000 items in FY24, including to people in need, assisting them to find employment and build a future with economic security Supporting vulnerable children We continued to provide Smiggle product donations to children in need Planet Measuring emissions We started measuring our primary suppliers' Greenhouse Gas Emissions Improving data We improved the accuracy of our packaging and waste data for APCO reporting Closing the loop We recycled over 3,500kg of soft plastic across our Support Office and Melbourne distribution centres Product Responsible fibre procurement We expanded responsible fabric sourcing in our product ranges, including 1,700+ metric tonnes of Better Cotton, and investment in more traceable viscose sources Better Cotton Together with increasing the use of Better Cotton, we achieved a successful outcome declaration result in our Better Cotton Independent Assessment Australian Cotton We have commenced a trial of Australian Cotton in a range of Just Jeans' womenswear Our commitment to ethical and responsible ways of working are embedded in our operations, supply chain and the communities in which we operate across the four strategic pillars set out below. Premier Investments Limited 9 We are committed to unlocking the potential of each of our 10,000+ strong team members. We also strive to attract and retain top talent that can meet the needs of our strategy and customers. Our work program, which forms the basis of our people strategy, has a specific emphasis on: • promoting the well-being and engagement of team members; • fostering diversity, equality, and inclusion; and • ensuring health and safety for our team members and customers Team Member Wellbeing & Engagement We continue to connect individual performance with the goals and values of our Group. We do this by: • Training & developing our people. In FY24 over 22 programs and 47 modules were available, together with an expanded Just Development Program for leaders. • Rewarding our team for excellence, including through seasonal bonus & incentive opportunities. • Supporting our people when they encounter challenging life situations. Our employee assistance program is accessible to team members in all markets. • Extending value by recognising the cost-of-living pressures on our team. We offer discounts for purchasing in our own stores, as well as for products from selected third parties (eg. health insurance, gym memberships, finance & technology products). Equality & Inclusion We stand firmly against all forms of discrimination in the workplace. We take great pride in the robust career opportunities we provide, particularly for women in the retail sector. In FY24, women comprised 91% of our workforce and held 50% of executive leadership roles. One third of the Premier Board are women. We remain dedicated to fostering comprehensive diversity and inclusion across our teams, continually learning from and engaging with our workforce on diversity initiatives to ensure our workplace is free from discrimination. Health & Safety Our team members have a right to be safe at work. Moreover, our team has a right to be treated respectfully at all times. We acknowledge and support recent industry initiatives to address the rising incidence of abuse and violence towards retail employees. Following the two significant & tragic emergency events that occurred at shopping centres at Bondi and Marion in early 2024, we were able to quickly put support in place for our team. As a result of those incidents, we have reviewed – and continue to review – our emergency preparation & response procedures to ensure our teams are well supported. We are proud of the way our teams responded to these tragic incidents. Our heartfelt condolences continue to be extended to those families impacted by these terrible events. Those incidents emphasise the need to create a safe environment for our team, partners and customers. Our teams monitor, assess, prevent, record and mitigate risks using the 'Just Play it Safe' and 'Safety Eyes' framework. Psychosocial risk has been a key focus for FY24, with a psychosocial risk review completed and actions carried out to mitigate associated risks. To obtain deeper understandings and insights in respect of lost time as a result of injury, in FY24 in respect of Australian team members we implemented a new methodology for measuring lost time injuries (LTls) and lost time injury frequency rate (LTIFRs – the number of LTIs per million hours worked). This change in methodology enables us to better understand LTis related to muscular stress and manual handling. While we saw an increase in both measures (8.9% in LTls and 17.2% in LTIFR), the average amount of time lost for each claim reduced by 2.2% – meaning our team was able to return to work quicker than in previous periods. As a result of this change in methodology, while our year­-on-year data is not directly comparable, we have observed a general shift in LTis towards muscular stress where no objects are handled (vs manual handling LTis). This gives us opportunity to implement the results of our independently conducted Manual Handling Project (reported on in our FY23 annual report) in hand, to reduce the number of LTls – regardless of the cause – in future periods. Other new FY24 initiatives included a pilot program of Mental Health First Aid training involving selected Support Office Team Members and our Regional/ Cluster Manager teams, with a view to potentially expand this training initiative in the future. People 10 Annual Report 2024 91% WOMEN TEAM MEMBERS 50% WOMEN IN EXECUTIVE LEADERSHIP ROLES 48.3% INTERNAL SUCCESSION FILL RATE Premier Investments Limited 11 We are committed to upholding the highest human rights standards and responsible sourcing practices to protect the rights of workers and the communities from which we source. Our Ethical Sourcing Program We partner with product suppliers who work with factories based in China, Bangladesh, Vietnam, India, Pakistan, Indonesia and Taiwan. These factories participate in our Ethical Sourcing program. Our updated program, now in its fourth year, is monitored through a number of audit & compliance requirements, as well as regular factory visits throughout the year by our team. In FY24 we continued our partnership with LRQA to implement our program and to further understand Modern Slavery risk in our supply chain. Our framework approach is one of continuous improvement and full transparency. Full details of our framework are set out in our fourth Modern Slavery Statement, which we published in January 2024 and can be found on our website on the page 'Commitment to Sustainable & Responsible Business Practices'. Key projects delivered in FY24 Published updated living wage commitments In FY24 we updated our living wage commitments. In our update, we shared our progress on our 2022 commitments & detailed our future work program. Our FY24 achievements include: • Delivery of updated Responsible Purchasing Practices training to over 100 product team members • Increased the usage of open costs on core lines • Complete rollout of Amader Kotha helpline to all workers in Bangladesh • Commenced wage gap analysis in Bangladesh covering 20% of supplier factories We are committed to transparently reporting on our progress regarding living wage commitments, whilst we (along with industry participants) continue to strive to close the gap between minimum legal wage and a living wage. The full updated living wage statement can be found on our website. G ov er na nc e As se ss m en t A ud it , D ue D ili ge nc e & Re m ed ia ti o n & W or ke r & Tr ai ni n g Po lic ie s & Ri sk Up ho ld in g W or ke r Ri gh ts Co rr ec ti ve A ct io n Vo ic e In du st ry E ng ag e m en t Program framework: from engagement to action The six core pillars of our Ethical Sourcing Program framework include work programs in each pillar, informing actions and change. Partners 12 Annual Report 2024 Grievance Mechanism Rollout We successfully commenced the FY24 roll out of the Amader Kotha worker helpline with our factory partners located in Bangladesh. Amader Kotha translates in English to "Our Voice", with its mission to provide a trusted grievance channel for workers in the ready made garment sector in Bangladesh. The helpline, launched in 2014, reaches 1.5 million workers and takes an average of 2,248 calls a month. Our rollout commenced with supplier management teams, followed by an in-person introduction to the helpline with factory workers, led by our own Dhaka based team member. Our Melbourne based Ethical Sourcing & Sustainability Manager also attended and co-presented at some of the on-the-ground training sessions in Dhaka, demonstrating our commitment to invest in our people to bring them closer to our suppliers and their teams. These sessions gave workers an understanding of what the helpline is, how issues are remediated and how they can access the mechanism. These training sessions covered a total of 3,806 workers in 13 factories in Bangladesh. We look forward to providing further insights on grievance data received in our FY24 Modern Slavery Statement. Employment Injury Insurance Scheme In FY24 the Just Group became a signatory of the Employment Injury Insurance Scheme (EIS) pilot, which is supporting workers in the Bangladesh ready made garment industry. An initiative led by the International Labour Organization (ILO) and GIZ, this pilot scheme offers workers financial assistance in the instance of a workplace accident. The aim of the scheme is to ensure workers and their families are compensated if a workplace injury or fatality was to occur. As a partner of the scheme, Just Group provided a voluntary financial contribution to support the important work being done to expand this project. We have commenced engagement with the EIS team and our factory partners in Bangladesh, to deliver an orientation session for factories, outlining the scheme and how they can support a successful rollout. Further work on this project will continue into the FY25 reporting period and initial insights shared in our FY24 Modern Slavery Statement. Premier Investments Limited 13 Through continued collaboration, we are proud to work alongside a number of community organisations through financial and in-kind support programs. Community Supporting our communities & having a positive impact is important to us. Our FY 24 partnerships included the following outcomes: Over $39,000 raised, including through sale of Portmans x NBCF tote bags The Just Group has raised over $200,000 for Breast Cancer Research since 2016. 28,100 items donated Providing new wardrobes for over 1,100 people in need. 71,000 items donated since our partnership began. New Jacqui E gift bag initiative Raising funds to enable women to find employment and build a future with economic security. Over $100,000 raised for the RSPCA through continued Peter Alexander partnership With just under $8,000 raised in New Zealand for Paw Justice. Over $1.4 million raised for the RSPCA since our partnership began over a decade ago, and over $156,000 for Paw Justice in New Zealand. $114,000 Smiggle product donated over the last 2 years Through the Buddy Bag program, supporting vulnerable children experiencing crisis or trauma. Our contribution to this program includes backpacks, markers, pencils and books. Smiggle investing in anti-bullying partnerships & raising funds for this important cause Including raising over $40,000 in FY24 for anti-bullying organisation Dolly's Dream. Smiggle has raised over $160,000 across our long term fundraising partnership. In the UK, our Choose Kindness keyrings raised over £20,000 for The Diana Award. New Smiggle partnership in New Zealand Raising over NZ$8,000 through the sale of Choose Kindness keyrings, supporting Kiwi children living in hardship. Team member product donation Our team members ran three product drives this year. These included a period product drive to benefit Share the Dignity which was aligned with International Women's Day. This product drive assists women experiencing period poverty when experiencing or at-risk of domestic violence or homelessness. Our team also ran food drives for OzHarvest and FoodBank, supporting Australians experiencing food scarcity. Partners continued 14 Annual Report 2024 We recognise our responsibility to ensure we have a positive impact on the environment and play our part in making better decisions in our sourcing and operations. Our commitment to ongoing improvement includes focusing on increasing our understanding and impact of our sourcing and decision-making. In FY24 we continued making changes and improvements in the following areas: • Measuring our primary suppliers' Greenhouse Gas emissions in ERSA audits. So far over 85 sites have had data captured. Several sites are currently using renewable energy which will inform future projects and supplier requirements • Commenced scoping the upcoming Climate Related Financial Disclosures legislation to ensure future compliance • Commenced the conversion to 100% recycled plastic packaging in our supply chain, starting with the denim and pant categories • All customer-facing shipper bags used in our online business are 100% recycled plastic • Continued use of Forest Stewardship Council (FSC) certified paper and cardboard in our distribution centre and packaging • Our orders of paper customer shopping bags versus reusable plastic customer shopping bags has improved significantly year-on-year, as set out below: We acknowledge the need for accelerated change in light of upcoming legislative requirements. Our work program will continue to adapt our policies and activities to ensure they meet the expectations of the suppliers and workers in our supply chain, our customer, team members and shareholders. Reground Our partnership with social enterprise Reground has continued in our Melbourne support office and Australian distribution centres. Both our coffee grounds and soft plastics are collected and are distributed or recycled into positive solutions. Soft plastic is recycled into building film or turned into innovative Plastoil, whilst coffee grounds are distributed to the Melbourne zoo as well as home or community gardens. Through our partnership with Reground we have recovered 5,583kg of resources, whilst avoiding 6,754 greenhouse gas emissions. Soft plastic recycling: 2,802 kg Emissions avoided 3,503 kg Soft plastic diverted 39% Building Film 61% Plastoil Coffee ground collection: 68% Home Gardens 26% Melbourne Zoo 4% Community Gardens 2,080 kg Coffee diverted 3,952 kg Emissions avoided As a signatory to the Australian Packaging Covenant (APCO), we report each year on our waste and packaging. With a higher accuracy in data required this year, we engaged with a third party to assist in measuring our packaging and APCO data requirements. Our work will continue in the next reporting period with a focus on training our teams on APCO's sustainable packaging guidelines. 15.7% 77.1% 43.2% -122.7% -115.1% -29.2% -150% -100% -50% 0% 50% 100% Small bags Medium bags Large bags Paper Plastic Customer shopping bag orders FY24 % increase/decrease by bag size Planet Premier Investments Limited 15 Our product ranges are evolving & improving to meet changing customer trends and values. We are on a journey of sourcing more responsible products across our brands in recognition of the social and environmental impacts that our purchasing decisions have. As the majority of our apparel products we sell are made from cotton, polyester or viscose fibres we are focussed on converting from the conventional fabrications to more responsible options. In FY24, our key initiatives with our product ranges included: Better Cotton membership We partner with Better Cotton to improve cotton farming globally. Through its implementation partners, Better Cotton trains farmers to use water efficiently, care for soil health and natural habitats, reduce the use of harmful chemicals and respect workers' rights and wellbeing. In FY24, we sourced 1,718 metric tonnes of Better Cotton across Just Jeans, Jay Jays, Peter Alexander, Dotti, Portmans and Jacqui E. In the reporting period we commissioned third party auditor, Control Union to conduct an independent assessment of our Better Cotton sourcing data. This requirement was mandated for Better Cotton brand members, to ensure the correct cotton consumption data is submitted annually. After working closely with Control Union to close out a corrective action plan (CAP) from the assessment, Just Group were given a successful outcome declaration, outlining that our processes for collecting and storing data are compliant with Better Cotton's requirements. Additionally, through this auditing process we identified areas of improvement to ensure data collection is streamlined across all brands. These changes will be implemented in FY25. Australian Cotton Trial Just Jeans began a trial of sourcing Australian cotton for a range of women's t-shirts which were manufactured with one of our strategic factory partners in Bangladesh. The success of this trial will inform future sourcing efforts. Global Organic Textile Standard (GOTS) Products sourced to the GOTS standard focus on a range of social and environmental metrics in relation to organic processing methods. Clothing produced under a GOTS certification must use a minimum of 95% organic cotton. Peter Alexander continues its commitment to GOTS for a selection of women's, junior and baby sleepwear. In the reporting period, 20% and 5% of the baby and junior ranges respectively were sourced to the GOTS standard. Responsible Viscose Sourcing Our aim is to avoid untraceable sources of viscose and to ensure it doesn't come from endangered and ancient forests. LENZI NG™ ECOVERO™ and Birla Cellulose's Liva Eco™ are viscose fibres derived from certified renewable wood sources and made using more responsible production methods, both generating lower emissions and having a reduced water impact than traditional viscose. In the reporting period, Jacqui E, Dotti, Portmans and Peter Alexander had a number of products which contained ECOVERO™ or Liva Eco™. Recycled Polyester We recognise the environmental impact of sourcing synthetic fibres derived from petroleum, such as polyester. Recycled polyester uses existing materials in the supply chain to help create new fabric. With a lower reliance on resources such as water and energy, these fabrics are less resource intensive than conventional polyester. In the reporting period, our teams continued to source recycled polyester where possible into new ranges. Cotton Pledge We do not condone the sourcing of cotton harvested from any region where state sanctioned forced labour regimes or where forced labour practices exist. Animal welfare We do not condone any form of animal cruelty. The following animal derived materials are banned from all Just Group products – angora & other rabbit hair; fur, feathers and exotic skins. Product 16 Annual Report 2024 Premier Investments Limited A.C.N. 006 727 966 For the period 30 July 2023 and 27 July 2024 Financial Report Directors’ Report 2 Auditor’s Independence Declaration 34 Statement of Comprehensive Income 35 Statement of Financial Position 36 Statement of Cash Flows 37 Statement of Changes In Equity 38 Notes to the Financial Statements 39 Directors’ Declaration 88 Independent Auditor’s Report to the Members of Premier Investments Limited 90 ASX Additional Information 96 Corporate Directory 97 Contents 1 Annual Report 2024 Directors’ Report Premier Investments Limited 2 The Board of Directors of Premier Investments Limited (A.B.N. 64 006 727 966) has pleasure in submitting its report in respect of the financial year ended 27 July 2024. The Directors present their report together with the consolidated financial report of Premier Investments Limited (the “Company” or “Premier") and its controlled entities (the “Group”) for the 52 week period 30 July 2023 to 27 July 2024, together with the independent audit report to the members thereon. DIRECTORS The names and details of the Company’s Directors in office during the financial year and until the date of the report are as follows. Directors were in office for this entire period unless otherwise stated. Solomon Lew Chairman and Non-Executive Director Mr. Lew was appointed as Non-Executive Director and Chairman of Premier on 31 March 2008. Mr. Lew is a director of Century Plaza Investments Pty Ltd, the largest shareholder in Premier and was previously Chairman of Premier from 1987 to 1994. Mr. Lew has over 50 years’ experience in the manufacture, wholesale and retailing of textiles, apparel and general merchandise, as well as property development. His success in the retail industry has been largely due to his ability to read fashion trends and interpret them for the Australasian market, in addition to his demonstrated ability in the timing of strategic investments. Mr. Lew was a Director of Coles Myer Limited from 1985 to 2002, serving as Vice Chairman from 1989, Chairman from 1991 to 1995, Executive Chairman in 1995 and Vice Chairman in 1995 and 1996. Mr. Lew is a member of the World Retail Hall of Fame and is the first Australian to be formally inducted. He is also a former Board Member of the Reserve Bank of Australia and former Member of the Prime Minister’s Business Advisory Council. Mr. Lew was the inaugural Chairman of the Mount Scopus Foundation (1987 – 2013) which supports the Mount Scopus College, one of Australia’s leading private colleges with 2000 students. He has also been the Chairman or a Director of a range of philanthropic organisations. Dr. David M. Crean Deputy Chairman and Non-Executive Director Dr. Crean has been an Independent Non-Executive Director of Premier since December 2009, Deputy Chairman since July 2015 and is currently the Chairman of Premier’s Audit and Risk Committee (appointed August 2010). Dr. Crean was Chairman of the Hydro Electric Corporation (Hydro Tasmania) from September 2004 until October 2014 and was also Chairman of the Business Risk Committee at Hydro Tasmania, member of the Audit Committee and Chairman of the Corporate Governance Committee. Dr. Crean was State Treasurer of Tasmania from August 1998 to his retirement from the position in February 2004. He was also Minister for Employment from July 2002 to February 2004. He was a Member for Buckingham in the Legislative Council from 1992 to February 1999, and then for Elwick until May 2004. From 1989 to 1992 he was the member for Denison in the House of Assembly. From 1993 to 1998 he held Shadow Portfolios of State Development, Public Sector Management, Finance and Treasury. Dr. Crean has been a Non-Executive Director and Deputy Chairman of Moonlake Investments, owner of VDL dairy farms in Tasmania from August 2016 to April 2018. He is also a Board member of the Linfox Foundation. Dr. Crean graduated from Monash University in 1976 with a Bachelor of Medicine and Bachelor of Surgery. Directors’ Report continued 3 Annual Report 2024 Timothy Antonie Non-Executive Director and Lead Independent Director Mr. Antonie was appointed to the Board of Directors on 1 December 2009. He holds a Bachelor of Economics degree from Monash University and qualified as a Chartered Accountant with Price Waterhouse. He has 20 years’ experience in investment banking and formerly held positions of Managing Director from 2004 to 2008 and Senior Advisor in 2009 at UBS Investment Banking, with particular focus on large scale mergers and acquisitions and capital raisings in the Australian retail, consumer, media and entertainment sectors. Mr. Antonie is also Chairman of Breville Group Limited and Netwealth Group Limited and is a Principal of Stratford Advisory Group. Sylvia Falzon Non-Executive Director Ms. Falzon was appointed to the Board of Directors on 16 March 2018. As a Non-Executive Director since 2010, Ms. Falzon has experience across a range of sectors and customer driven businesses in financial services, health, aged care, e-commerce and retail. During this time, she has been involved in several business transformations, IPOs, merger and acquisitions and divestment activities. Ms. Falzon is currently an Independent Non-Executive Director of the ASX listed company Suncorp Group Limited. In the not-for-profit sector, she is the Chairman of Cabrini Australia Limited, and is also a member of the Australian Government Takeovers Panel. Ms. Falzon previously served on the board of ASX listed companies Zebit Inc until 17 March 2022 and Regis Healthcare until October 2021. Ms. Falzon holds a Masters Degree in Industrial Relations and Human Resource Management (Hons) from the University of Sydney and a Bachelor of Business from the University of Western Sydney. She is a Senior Fellow of the Financial Services Institute of Australasia and a Fellow of the Australian Institute of Company Directors. Sally Herman Non-Executive Director Ms. Herman is an experienced Non-Executive Director in the fields of financial services, retail, manufacturing and property. She had a successful executive career spanning 25 years in financial services in both Australia and the US, transitioning in late 2010 to a full time career as a Non-Executive Director. Prior to that, she had spent 16 years with the Westpac Group, running major business units in most operating divisions of the Group as well as heading up Corporate Affairs and Sustainability through the merger with St. George and the global financial crisis. Ms. Herman sits on both listed and not-for-profit Boards, including Suncorp Group Limited, Breville Group Limited and Abacus Property Group. She is also a Trustee of the Art Gallery of NSW. Ms. Herman was previously a director of Irongate Funds Management Limited (taken over by Charter Hall in 2022), and E&P Financial Group Limited (resigned November 2021). Ms. Herman holds a Bachelor of Arts from the University of New South Wales and is a Graduate of the Australian Institute of Company Directors. Henry D. Lanzer AM B.COM. LLB (Melb) Non-Executive Director Henry Lanzer AM is Managing Partner of Australian commercial law firm, Arnold Bloch Leibler. Henry has over 40 years’ experience in providing legal, corporate finance and strategic advice to some of Australia’s leading companies. Mr. Lanzer was appointed to the Board of Directors in 2008. He is a Non-Executive Director of Just Group Limited, Thorney Opportunities Limited and previously the TarraWarra Museum of Art and the Burnett Institute. He is also a Life Governor of the Mount Scopus College Council. In June 2015, Mr. Lanzer was appointed as a Member of the Order of Australia. Premier Investments Limited 4 Terrence L. McCartney Non-Executive Director Mr. McCartney has had a long and successful career in retail. Mr. McCartney started at Boans Department Stores in Perth then moved to Grace Bros in Sydney. After the acquisition of Grace Bros by Myer, he relocated to the merged Department Stores Group in Melbourne within the merchandise and marketing department. His successful career within Coles Myer meant that Terry then moved to the Kmart discount department stores as Head of Merchandise and Marketing and then Managing Director. Following several years as Managing Director of Kmart Australia and New Zealand, Terry became Managing Director of Myer Grace Bros. For 5 years Terry lead year on year growth in profitability of Australia’s largest department store. Terry’s experience spans the full spectrum of retailing, ranging from luxury goods in department stores to large mass merchandise discount operations. Terry has also been retained by large international accounting and legal firms as an expert witness in relation to Australian retail. In addition to his extensive list of retail experience, he has also been an advisor to large Australian and international mining companies, prior to joining the Just Group Board in 2008. Terry lends his extensive retail and commercial expertise to the Just Group as Non-Executive Director, and by serving on a number of committees and through various store and site visits, both locally and overseas. He is also involved in seasonal and trading performance reviews for the Group. Terry is a member of the Remuneration and Nomination Committee of Premier Investments Limited. In August 2017, he was appointed Chairman of the Remuneration and Nomination Committee. Terry is also a Non-Executive Director of Myer Holdings Limited. Michael R.I. McLeod Non-Executive Director Mr. McLeod is a former Executive Director of the Century Plaza Group. He has been a Non-Executive Director of Premier Investments Limited since 2002 and was a Non-Executive Director of Just Group Limited from 2007 to 2013. Past experience includes the Australian Board of an international funds manager, chief of staff to a Federal Cabinet Minister and statutory appointments including as a Commission Member of the National Occupational Health and Safety Commission. He holds a Bachelor of Arts (First Class Honours and University Medal) from the University of New South Wales. Andrea Weiss Non-Executive Director (Appointed: 4 December 2023) Ms Weiss was appointed to the Board of Directors on 4 December 2023. She brings to Premier a thirty-year career in senior leadership with some of the world’s foremost retailers. She founded The O Alliance LLC and is Chief Executive Officer and founder of Retail Consulting Inc in the United States of America. Ms Weiss has held various senior executive positions with notable retailers, including as Executive Chair of Grupo Cortefiel/Tendam (Spain), President Guess Inc, Chief Stores Officer L Brands, Executive Vice President Ann Taylor, and Director of Merchandising of The Walt Disney Company. She has also been a senior advisor to technology firms such as SAP, Zebra Technologies, and TYCO Retail Solutions. Ms Weiss has been a member of several listed company boards in the United States and currently serves on the boards of O’Reilly Auto Parts (ORLY:NASDAQ) and RPT Realty (RPT:NYSE). She is also Chairman of the not-for-profit, Delivering Good. Ms. Weiss holds a Masters Degree of Administrative Science from The John Hopkins University, and a Bachelor of Fine Arts from Virginia Commonwealth University. She also completed post-graduate studies at Harvard Business School and The Kellogg School at Northwestern University. Ms. Weiss currently resides in the United States. Richard Murray Executive Director (Resigned as Director: 21 August 2023) Richard Murray commenced as Premier Retail Chief Executive Officer on 6 September 2021 and was appointed to the Premier Board as Executive Director on 3 December 2021. Richard has over 25 years’ experience in retail and finance. Prior to joining Premier, Richard held the position of Group Chief Executive Officer and Executive Director at JB Hi-Fi Limited (ceased August 2021). Richard resigned as Premier Retail Chief Executive Officer effective 15 September 2023 and resigned as Executive Director of Premier Investments Limited effective 21 August 2023. Directors’ Report continued 5 Annual Report 2024 COMPANY SECRETARY Marinda Meyer Ms. Meyer has over 20 years’ experience as a Chartered Accountant in senior finance roles. She has both local and international experience in financial accounting and reporting, corporate governance, and administration of listed companies. PRINCIPAL ACTIVITIES The Group operates a number of specialty retail fashion chains within the specialty retail fashion markets in Australia, New Zealand, Asia and Europe. The Group also has significant investments in listed securities and money market deposits. DIVIDENDS CENTS $’000 Final Dividend approved for 2024 70.00 111,761 Dividends paid in the year: Final Dividend for 2023 (paid: 24 January 2024) 60.00 95,675 Interim Dividend for the half-year ended 27 January 2024 (paid: 24 July 2024) 63.00 100,569 OPERATING AND FINANCIAL REVIEW Group Overview: Premier Investments Limited acquired a controlling interest in Just Group Limited (“Just Group”), a listed company on the Australian Securities Exchange in August 2008. Just Group is a leading specialty fashion retailer with operations in Australia, New Zealand, Asia and Europe. The Group has a number of well-recognised retail brands, consisting of Just Jeans, Jay Jays, Jacqui E, Portmans, Dotti, Peter Alexander and Smiggle. Currently, these seven unique brands are trading from more than 1,100 stores across six countries, as well as through wholesale and online. The Group’s key strategic growth initiatives continue to deliver results for the Group. The Group’s emphasis is on a range of brands that provide quality products to its target demographic and has a sufficiently broad appeal to enable a comprehensive footprint. Over 90% of the product range is designed, sourced and sold under its own brands. There is a continuing investment in these brands to ensure they remain relevant to changing customer tastes and remain at the forefront of their respective target markets. In addition to its investment in Just Group, Premier owns strategic investments in Breville Group Limited (2024: 25.45%, 2023: 25.56%) and Myer Holdings Limited (2024: 31.37%, 2023: 25.79%). As at 27 July 2024, both these investments are reflected as Investments in Associates in the Group’s Statement of Financial Position. The combined fair value of these investments at year-end was $1,196.8 million (based on quoted market prices as at 27 July 2024). Premier Investments Limited 6 OPERATING AND FINANCIAL REVIEW (CONTINUED) Group Overview (continued): The Group’s reported revenue from contracts with customers, total income and net profit before income tax for the 52 week period ended 27 July 2024 (2023: 52 week period ended 29 July 2023) are summarised below: CONSOLIDATED 52 WEEKS ENDED 27 JULY 2024 $’000 52 WEEKS ENDED 29 JULY 2023 $’000 % CHANGE Revenue from contracts with customers 1,595,326 1,643,502 -2.93% Total interest income 22,010 14,162 +55.42% Total dividend income - 4,695 -100% Total other income and revenue 2,125 2,194 -3.14% Total revenue and other income 1,619,461 1,664,553 -2.71% Reported profit before income tax 354,089 382,137 -7.34% Following the commencement of equity accounting for Myer Holdings Limited (“Myer”) in 2023, the Group increased its shareholding in Myer to 31.37% during the 2024 financial year (29 July 2023: 25.79%). The Group has continued to account for its investment in Myer as an investment in associate. Accounting for an investment as an associate under AASB 128 Investments in Associates and Joint Ventures involve complex accounting treatments for profit share, dividends received and other gains and losses resulting from shareholding dilution. To better understand and compare the result of the Group, and the sources of income received from its investments, the below table presents an adjusted net profit after taxation (Non-IFRS), which reflects the accounting for the Group’s investments on the basis of dividends received during the year instead of the share of associate’s profit recorded under equity accounting and also excludes the non-cash impairment expense of intangible assets. Non-IFRS information is not subject to audit or review. CONSOLIDATED 52 WEEKS ENDED 27 JULY 2024 $’000 52 WEEKS ENDED 29 JULY 2023 $’000 % CHANGE Statutory net profit after taxation, under IFRS 257,922 271,078 -4.85% Exclude: Share of profit from associates (42,411) (30,864) +37.41% Loss on investments in associates, resulting from share issue (included in other expenses) 3,097 703 +340.54% Non-cash impairment expense of intangible assets - 5,000 -100% Include: Cash dividends received from investment in associates, not accounted for in statutory profit after taxation 20,955 27,894 -24.88% Income tax expense adjustment on accounting for investments in associates 4,838 4,759 +1.66% Adjusted net profit after taxation (non-IFRS) 244,401 278,570 -12.27% Directors’ Report continued 7 Annual Report 2024 OPERATING AND FINANCIAL REVIEW (CONTINUED) Investment Segment: The Group’s balance sheet remains strong, primarily due to the significant asset holding of the investment segment. INVESTMENT IN BREVILLE GROUP LIMITED As at 27 July 2024, the Group continued to reflect its 25.45% (2023: 25.56%) shareholding in Breville Group Limited (“Breville”) as an investment in associate, with an equity accounted value of $347.2 million (2023: $333.7 million). The fair value of the Group’s interest in Breville as determined based on the quoted market price for the shares as at 27 July 2024 was $981.5 million (2023: $829.3 million). Dividends received from Breville during the year amounted to $11.5 million (2023: $10.9 million). Breville is a company incorporated in Australia, whose shares are quoted on the Australian Securities Exchange. The principal activities of Breville involves the innovation, development, marketing and distribution of small electrical appliances. Details of the Group’s investment in Breville can be summarised as follows: 52 WEEKS ENDED 27 JULY 2024 $’000 52 WEEKS ENDED 29 JULY 2023 $’000 % CHANGE Fair value of investment at year-end, based on quoted market prices 981,473 829,270 +18.35% Carrying value at year-end in the Statement of Financial Position, based on equity accounting 347,173 333,666 +4.05% Profit from associate recorded in the Group’s Statement of Comprehensive Income 30,157 28,169 +7.06% Cash dividends received from Breville during the year 11,497 10,950 +5.00% INVESTMENT IN MYER HOLDINGS LIMITED The Group commenced accounting for its shareholding in Myer Holdings Limited (“Myer”) as an investment in associate in the 2023 financial period. As at 27 July 2024, the Group continues to reflect its 31.37% (2023: 25.79%) shareholding in Myer as an investment in associate, with an equity accounted value of $161.0 million (2023: $125.1 million). The fair value of the Group’s interest in Myer as determined based on the quoted market price for the shares as at 27 July 2024 was $215.3 million (2023: $137.7 million). Dividends received from Myer during the year amounted to $9.5 million (2023: $21.6 million). Myer is a company incorporated in Australia, whose shares are quoted on the Australian Securities Exchange. The principal activities of Myer involves operation of a number of department stores across Australia and through its online business. Premier Investments Limited 8 OPERATING AND FINANCIAL REVIEW (CONTINUED) Investment Segment (continued): INVESTMENT IN MYER HOLDINGS LIMITED Details of the Group’s investment in Myer can be summarised as follows: 52 WEEKS ENDED 27 JULY 2024 $’000 52 WEEKS ENDED 29 JULY 2023 $’000 % CHANGE Fair value of investment at year-end, based on quoted market prices 215,302 137,667 +56.39% Carrying value at year-end in the Statement of Financial Position, based on equity accounting 161,032 125,108 +28.71% Profit from associate recorded in the Group’s Statement of Comprehensive Income 12,254 2,695* +354.69% Dividends received from Myer during the year 9,457 21,639* -56.30% *Prior to the commencement of equity accounting for Myer in Dec 2023, dividends received were reflected in the profit and loss. Following the commencement of equity accounting, profit from associate has been recorded in the Group’s Statement of Comprehensive Income. PROPERTY INVESTMENT Premier owns its Australian Distribution Centre, as well as the global head office building of Premier Retail in Melbourne. These properties are carried at a combined historical written down value at 27 July 2024 of $69.6 million (2023: $71.2 million). CASH HOLDINGS The Investment Segment recorded cash on hand as at 27 July 2024 of $234.1 million (2023: $242.8 million). Interest earned during the year ended 27 July 2024 amounted to $11.5 million (2023: $8.9 million). The investment segment’s cash holdings remain strong despite paying $196.2 million in dividends to shareholders during the 2024 financial year (2023: dividends paid amounted to $237.2 million). Retail Segment: As Premier’s core business, Just Group (Premier Retail) was the key contributor to the Group’s operating results for the financial year. Key financial indicators for the retail segment for the 52 week period ended 27 July 2024 (2023: 52 week period ended 29 July 2023) are highlighted below: RETAIL SEGMENT 52 WEEKS ENDED 27 JULY 2024 $’000 52 WEEKS ENDED 29 JULY 2023 $’000 % CHANGE Revenue from contracts with customers 1,595,326 1,643,502 -2.93% Total segment income 1,607,931 1,650,898 -2.60% Segment net profit before income tax 313,940 352,515 -10.94% Directors’ Report continued 9 Annual Report 2024 OPERATING AND FINANCIAL REVIEW (CONTINUED) Retail Segment (continued): The Retail Segment contributed $313.9 million to the Group’s net profit before income tax for the 52 week period ended 27 July 2024 (2023: $352.5 million net profit before income tax for the 52 week period ended 29 July 2023). Premier Retail’s Earnings Before Interest and Tax (EBIT), excluding significant items was $325.9 million for the 2024 financial year, a reduction of 8.56% on the previous financial year. Refer to page 11 of the Directors’ Report for a reconciliation of Premier Retail EBIT and reported Premier Retail Profit before Tax. Over the years, Premier Retail has evolved into a multi-channel global business, growing the portfolio of 7 unique brands to each have a distinctive and competitive market position. The Group’s ability to remain nimble, under the leadership of an experienced Board and highly motivated senior management team, enables the Group to pivot when macro-economic environments change. Premier Retail delivered global sales for the 2024 financial year of $1,595.3 million, a 2.93% reduction on the 2023 record financial year. The 2024 financial year sales result is the second highest sales result in the Group’s history, after cycling record sales in the 2023 financial year. Global sales are up 25.5% on pre-pandemic sales for the 2019 financial year. 167.3 187.2 304.3 335.0 356.5 325.9 0 50 100 150 200 250 300 350 400 FY19 (Pre-COVID) FY20 FY21 FY22 FY23 FY24 Premier Retail EBIT (comparable 52-week basis) $'million + 94.8% on “Pre-Covid” FY19 Premier Investments Limited 10 OPERATING AND FINANCIAL REVIEW (CONTINUED) Retail Segment (continued): Revenue from customers per Geographic Segment for the 52 weeks ended 27 July 2024 Pleasingly, Premier Retail delivered a gross margin percentage of 62.6%, up 35 basis points on the previous year (2023: 62.2%). The strong sales, solid gross profit and strong cost control has delivered a strong EBIT result of $325.9 million (down 8.6% on a record 2023 financial year EBIT of $356.5 million) in a challenging general discretionary environment, with consumers facing increased cost of living pressures. Peter Alexander delivered another record sales result for the 52-week period ended 27 July 2024 of $508.6 million, up 6.2% on a record set in the prior year (2023: $478.9 million). The record result was driven across all Peter Alexander product categories. The Group’s decision to invest in its retail channel delivered significant growth within the existing markets of Australia and New Zealand. The Group opened 9 new stores during the 2024 financial year, and 9 stores were relocated or expanded during the year, significantly improving the customer shopping experience. Smiggle delivered global sales of $296.0 million for the 52 weeks ended 27 July 2024, a decrease of 7.4% on a record sales result delivered in the prior financial year following a surge in spending as customers returned post COVID-19. The Smiggle customer is particularly exposed to increased cost of living pressures in all global markets. Notwithstanding the challenging environment, the brand continuously strives to deliver innovative and exciting new product ranges that stretch the age demographic from 3 years old, up to 14 years old. The brand is currently trading from 43 fewer stores than in the 2019 financial year (pre-COVID), when the brand delivered a then record sales result of $306.5 million. The Group’s five iconic Apparel Brands (Just Jeans, Jay Jays, Portmans, Dotti and Jacqui-E) delivered a combined sales result for the period ended 27 July 2024 of $790.7 million - up 10.3% on pre-pandemic sales of $716.7 million in the 2019 financial year, and trading from 35 less stores than at July 2019. The 2024 financial year sales result for the Apparel Brands is down 6.4% on the previous year’s record sales result of $844.8 million. The Retail Segment delivered online sales of $315.3 million for the 52 weeks ended 27 July 2024 contributing 19.8% of total group sales to customers for the period ended 27 July 2024 (2023: 19.8%). The Group is pleased to have world class customer facing websites, where the Group’s most viewed store window and largest store is the brand’s online channel. The Group seeks to delight customers with a seamless customer experience across all channels, supporting customers in whichever way they choose to shop. As a result, the Group will continue to invest in people, technology and marketing to improve our platforms and customer experiences. The Group operates centralised distribution centres in four countries, including the Group’s owned Australian Distribution Centre. These distribution centres have enabled the Group to be agile and scale up operations in response to customer shopping behaviours across all channels. Australia 79% New Zealand 10% Asia 4% Europe 7% OPERATING AND FINANCIAL REVIEW (CONTINUED) Reconciliation between Premier Retail EBIT and Reported Retail Segment Result The Group’s results are reported under Australian Accounting Standards and International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (IASB). Non-IFRS information is financial information that is presented other than in accordance with all relevant accounting standards and is not subject to audit or review. The Group provides these Non-IFRS financial measures to better understand key aspects of the performance and drivers of the Group’s Retail Segment. The table below reconciles the Non-IFRS financial term Premier Retail EBIT to the Reported Retail Segment Result for each of the financial years: RETAIL SEGMENT FINANCIAL YEAR ENDED 27 JULY 2024 $’000 FINANCIAL YEAR ENDED 29 JULY 2023 $’000 FINANCIAL YEAR ENDED 30 JULY 2022 $’000 FINANCIAL YEAR ENDED 31 JULY 2021 $’000 FINANCIAL YEAR ENDED 25 JULY 2020 $’000 Reported Retail Segment Operating Profit before Taxation 313,940 352,515 353,192 352,112 165,776 Add back: Interest expense (excluding AASB 16 interest on lease liabilities) 4,723 2,755 1,379 1,967 2,757 Adjust for: Net impact of AASB 16 on results 7,237 2,662 (2,039) (2,147) 427 Pre-AASB 16 EBIT, including one-off and significant items 325,900 357,932 352,532 351,932 168,980 One-off COVID-19 impairment of store plant & equipment and associated costs - - - - 31,420 One-off COVID-19 net gain from settlement of cash flow hedge book - - - - (13,207) Pre-AASB 16 EBIT, excluding one-off items 325,900 357,932 352,532 351,932 187,193 Non-comparable EBIT contribution for the 53rd week in 2021 - - - (8,894) - COVID-19 related rent concessions - (1,432) (10,538) (19,521) - Other Australia and New Zealand holdover rent concessions - - (3,465) (9,960) - COVID-19 United Kingdom temporary rates relief - - (3,500) (4,600) - COVID-19 United Kingdom lockdown grants - - - (4,622) - Pre-AASB 16 Premier Retail EBIT excluding significant items 325,900 356,500 335,029 304,335 187,193 Premier Retail EBIT, expressed in $’ millions 325.9 356.5 335.0 304.3 187.2 Directors’ Report continued 11 Annual Report 2024 Premier Investments Limited 12 SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS There have been no significant changes in the state of affairs of the Group during the financial year ended 27 July 2024. SIGNIFICANT EVENTS AFTER THE REPORTING DATE The Directors of Premier Investments Limited approved a final ordinary dividend in respect of the 2024 financial year. The total amount of the final ordinary dividend is $111,761,000 (2023: Final ordinary dividend of $95,675,000) which represents a fully franked ordinary dividend of 70 cents per share (2023: Final ordinary dividend of 60 cents per share, special dividend of 16 cents per share). The dividend has not been provided for in the 2024 financial statements. LIKELY DEVELOPMENTS AND EXPECTED RESULTS Certain likely developments in the operations of the Group and the expected results of those operations in financial years subsequent to the period ended 27 July 2024 are referred to in the preceding operating and financial review. No additional information is included on the likely developments in the operations of the Group and the expected results of those operations as the Directors reasonably believe that the disclosure of such information would be likely to result in unreasonable prejudice to the Group if included in this report, and it has therefore been excluded in accordance with section 299(3) of the Corporations Act 2001. ENVIRONMENTAL REGULATION AND PERFORMANCE The Group’s operations are not subject to any significant environmental obligations or regulations. SHARE OPTIONS AND SHARES ISSUED DURING THE FINANCIAL YEAR Unissued Shares: As at the date of this report, there were 561,780 (2023: 1,051,965) unissued performance rights. Refer to the remuneration report for further details of the options outstanding in relation to Key Management Personnel. Shares Issued as a Result of the Exercise of Options: A total of 433,799 shares (2023: 231,603) were issued during the year pursuant to the Group’s Performance Rights Plan. No other shares were issued during the year. ROUNDING The company is a company of the kind specified in ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191, dated 24 March 2016. In accordance with that ASIC instrument amounts in the financial statements and the Directors’ Report have been rounded to the nearest thousand dollars unless specifically stated to be otherwise. INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS To the extent permitted by law, the company indemnifies every person who is or has been a director or officer of the company or of a wholly-owned subsidiary of the company against liability for damages awarded or judgments entered against them and legal defence costs and expenses, arising out of a wrongful act, incurred by that person whilst acting in their capacity as a director or officer provided there has been no admission, or judgment, award or other finding by a court, tribunal or arbitrator which establishes improper use of position, or committing of any criminal, dishonest, fraudulent or malicious act. The officers include the Directors, as named earlier in this report, the Company Secretary and other officers, being the executive senior management team. Details of the nature of the liabilities covered or the amount of the premium paid in respect of the Directors, and Officers, liability insurance contracts are not disclosed as such disclosure is prohibited under the terms of the contracts. Directors’ Report continued 13 Annual Report 2024 INDEMNIFICATION OF AUDITORS To the extent permitted by law, the company has agreed to indemnify its auditors, Ernst & Young, as part of the terms of its audit engagement agreement against claims by third parties arising from the audit (for an unspecified amount). No payment has been made to indemnify Ernst & Young during or since the financial year. DIRECTOR INTERESTS IN SHARES AND RIGHTS OF THE COMPANY At the date of this report, the interests of the Directors in the shares and performance rights of the company were: Solomon Lew 4,437,699 ordinary shares** Timothy Antonie 5,001 ordinary shares Sally Herman 11,500 ordinary shares Henry Lanzer AM 27,665 ordinary shares Michael McLeod 28,186 ordinary shares **Mr. Lew is an associate of Century Plaza Investments Pty. Ltd. and Metrepark Pty. Ltd (Associated Entities). The Associated Entities, collectively, have a relevant interest in 59,804,731 shares in the Company. However, Mr. Lew does not have a relevant interest in the shares of the Company held by the Associated Entities. DIRECTORS’ MEETINGS The number of meetings of the Board of Directors during the financial year, and the number of meetings attended by each Director were as follows: BOARD MEETINGS AUDIT AND RISK COMMITTEE REMUNERATION AND NOMINATION COMMITTEE DIRECTOR MEETINGS HELD NUMBER ATTENDED MEETINGS HELD NUMBER ATTENDED MEETINGS HELD NUMBER ATTENDED Solomon Lew 10 10 - - - - Richard Murray1 2 - - - - - Timothy Antonie 10 10 5 5 2 2 David Crean 10 10 5 5 - - Sylvia Falzon 10 10 5 5 - - Sally Herman 10 10 5 5 - - Henry Lanzer AM 10 10 - 1 - - Terrence McCartney 10 8 - 2 2 2 Michael McLeod 10 10 - - 2 2 Andrea Weiss2 5 5 - 2 - - CORPORATE GOVERNANCE STATEMENT To view Premier’s Corporate Governance Statement, please visit www.premierinvestments.com.au/about-us/board- policies. AUDITOR INDEPENDENCE The Directors received a copy of the Auditor’s Independence Declaration in relation to the audit for this financial year and is presented on page 34. 1 Richard Murray resigned as a director effective 21 August 2023 2 Andrea Weiss was appointed as a director effective 04 December 2023 Premier Investments Limited 14 NON-AUDIT SERVICES The Directors are satisfied that the provision of non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The nature and scope of each type of non-audit service provided means that independence was not compromised. Details of non-audit services provided by the Group’s auditor, Ernst & Young, can be found in Note 30 of the Financial Report. REMUNERATION REPORT The Remuneration Report, which forms part of this Directors’ Report, is presented from page 15. The Directors’ Report is signed in accordance with a resolution of the Board of Directors. Solomon Lew Chairman 24 September 2024 Directors’ Report continued 15 Annual Report 2024 REMUNERATION REPORT Dear Shareholders, As Chairman of the Remuneration and Nomination Committee, I am pleased to present Premier Investments’ remuneration report for the 52 weeks ended 27 July 2024. This report outlines, in detail, the remuneration outcomes and incentive arrangements, related to our performance. Premier has yet again delivered a strong result for shareholders during the 2024 financial year. Premier Retail delivered a pre-AASB16 EBIT of $325.9 million for the year, down 8.56% on the record EBIT result delivered in the previous financial year, but up 94.8% on pre-COVID FY19. This result was delivered despite a challenging general discretionary retail environment with consumers facing increased cost of living pressures. The Group remained focused on delivering value for customers in the product offering and shopping experience, whilst managing inventory productivity and operational efficiencies. The Board recognises that the performance of the Group depends on the quality and dedication of our entire global workforce. Our experienced executive leadership team, which includes our executive Key Management Personnel, provide the integral backbone to the Group. The Group continued its strong performance in FY24. This has translated into strong returns for our shareholders:  Premier Investments Limited statutory net profit after tax of $257.9 million, although this is down 4.9% on the 2023 financial year, this remains up over 140% on a ‘pre-COVID’ 2019 financial year;  Premier Investments Limited adjusted net profit after tax of $244.4 million (refer to page 6 of the Directors’ Report for a breakdown of adjusted net profit after tax);  Premier Retail EBIT of $325.9 million, a decrease of 8.56% on a record FY23, and an increase of 94.8% on a ‘pre-COVID’ 2019 financial year;  Premier Retail sales to customers of $1,595.3 million, a decrease of 2.93% on the previous financial year, and up 25.5% on a ‘pre-COVID’ 2019 financial year;  During the 2024 financial year, Premier paid dividends to shareholders totaling over $196.2 million;  Full year total ordinary dividends of 133 cents per share for the 2024 financial year; an increase of 2.3% on the previous financial year total dividends (ordinary and special), and the highest ordinary dividend in the Group’s history;  The Group’s total shareholder return (TSR) consistently outperforming the ASX 200 Index return. 70 80 100 114 133 25 16 0 20 40 60 80 100 120 140 FY20 FY21 FY22 FY23 FY24 Full year ordinary and special dividends per share (fully franked) Ordinary Special Premier Investments Limited 16 REMUNERATION REPORT (CONTINUED) The Group’s ability to respond quickly to changing environments, through strategic planning and execution by an experienced Board and skilled management team, have led to shareholders enjoying strong financial returns. The Group is committed to ensuring that executive remuneration outcomes are explicitly linked to the overall performance and success of the Group. The importance of attracting, retaining and rewarding a diverse senior executive team is crucial in navigating through a complex macro-economic environment. The Group’s strategic review, announced by the Premier Board in August 2023, has continued to progress throughout the year. Premier Retail’s experienced senior management team continued to focus on exceptional retail execution and responding to rapid changes in consumer shopping behaviours and preferences throughout the year, whilst identifying, developing and refining growth paths for each of Smiggle, Peter Alexander and the Apparel Brands as part of the strategic review. The Premier Board’s continuing assessment of these growth opportunities takes into consideration the principle of value creation for Premier’s stakeholders. The Remuneration Report summarises our remuneration strategies, the way in which incentives are calculated, and the connection between those strategies and the achievement of positive returns for shareholders. Terrence McCartney Chairman, Remuneration and Nomination Committee Directors’ Report continued 17 Annual Report 2024 REMUNERATION REPORT (AUDITED) This remuneration report for the 52 weeks ended 27 July 2024 outlines the remuneration arrangements of the Group in accordance with the requirements of the Corporations Act 2001 (Cth), as amended (the “Act”) and its regulations. This information has been audited as required by section 308 (3C) of the Act. The remuneration report is presented under the following headings: 1. Introduction 2. Remuneration Governance 3. Executive remuneration arrangements: A. Remuneration principles and strategy B. Fixed remuneration objectives C. Group performance and its link to executive remuneration D. Group performance and its link to STI E. Group performance and its link to LTI F. Detail of incentive plans 4. Remuneration framework of CEO (Retail) 5. Executive service agreements 6. Non-Executive Director remuneration arrangements 7. Remuneration of Key Management Personnel 8. Additional disclosures relating to Rights and Shares of Key Management Personnel 9. Additional disclosures relating to transactions and balances with Key Management Personnel and their Related Parties 1. INTRODUCTION The remuneration report details the remuneration arrangements for Key Management Personnel (“KMP”) who are defined as those persons having authority and responsibility for planning, directing and controlling the major activities of the Group, directly or indirectly, including any director (whether executive or otherwise) of the Group. The table below outlines the Group’s KMP during the 52 weeks ended 27 July 2024. Unless otherwise indicated, the individuals were KMP for the entire financial year. KEY MANAGEMENT PERSONNEL (i) Non-Executive Directors Solomon Lew Chairman and Non-Executive Director David Crean Deputy Chairman and Non-Executive Director Timothy Antonie Non-Executive Director and Lead Independent Director Sylvia Falzon Non-Executive Director Sally Herman Non-Executive Director Henry Lanzer AM Non-Executive Director Terrence McCartney Non-Executive Director Michael McLeod Non-Executive Director Andrea Weiss Non-Executive Director (appointed effective 4 December 2023) Premier Investments Limited 18 REMUNERATION REPORT (AUDITED) (CONTINUED) 1. INTRODUCTION (CONTINUED) KEY MANAGEMENT PERSONNEL (CONTINUED) (ii) Executive Director Richard Murray Executive Director and Chief Executive Officer (Retail) (see note (a)) (iii) Executives John Bryce Interim Chief Executive Officer (Retail) and Chief Financial Officer, Just Group Limited (see note (b)) Marinda Meyer Company Secretary, Premier Investments Limited (a) Mr. Murray resigned as Chief Executive Officer (Retail) effective 15 September 2023 and resigned as an Executive Director effective 21 August 2023. Mr. Murray ceased being a KMP as of 15 September 2023. (b) Mr. Bryce was appointed Interim Chief Executive Officer (Retail) on 21 August 2023, in addition to fulfilling his duties as Chief Financial Officer of Just Group Limited. There were no other changes to the KMP after the reporting date and before the date the financial report was authorised for issue. 2. REMUNERATION GOVERNANCE Remuneration and Nomination Committee The Remuneration and Nomination Committee (“Committee”) of the Board of Directors of the Group (“Board”) comprises three Non-Executive Directors. The Committee is led by Terrence McCartney, an independent Non-Executive Director, and the majority of its members are independent Non-Executive Directors. This demonstrates an ongoing commitment to the independence of the Committee. The Committee has delegated decision-making authority for some matters related to the remuneration arrangements for KMP and is required to make recommendations to the Board on other matters. Specifically, the Board approves the remuneration arrangements of the Chief Executive Officer (Retail) (“CEO Retail”) and senior executives, including awards made under the short-term incentive (“STI”) and long-term incentive (“LTI”) plans, following recommendations from the Committee. The Board also sets the aggregate remuneration for Non- Executive Directors (which is subject to shareholder approval) and Non-Executive Director fee levels. The Committee meets regularly. The CEO (Retail) attends certain Committee meetings by invitation, where management input is required. The CEO (Retail) is not present during discussions relating to his own remuneration arrangements. Further information relating to the Committee’s role, responsibilities and membership can be seen at www.premierinvestments.com.au. Use of remuneration advisors The Committee may from time to time seek external remuneration advice to ensure it is fully informed when making remuneration decisions. Remuneration advisors are engaged by, and report directly to, the Committee. No remuneration recommendations for the purposes of the Corporations Act 2001 were made during the 2024 financial year. Directors’ Report continued 19 Annual Report 2024 REMUNERATION REPORT (AUDITED) (CONTINUED) 3. EXECUTIVE REMUNERATION ARRANGEMENTS 3A. Remuneration principles and strategy For the 52 weeks ended 27 July 2024, the executive remuneration framework comprised of fixed remuneration, STI and LTI, as outlined below. The Group aims to reward executives with a competitive level and mix of remuneration appropriate to their position and responsibilities and linked to shareholder value creation. The Group’s executive remuneration strategy is designed to attract, motivate and retain high performing individuals, and align the interests of executives with shareholders. The Group operates mainly in the retail industry, with significant revenues earned in its traditional markets of Australia and New Zealand. The retail industry in these markets has seen marked structural change over recent years, including a prevalence in the use of new and existing technology, an increase in international competitors and significant changes in general consumer sentiment. Complementing its strong market position in Australia and New Zealand, the Group continues to operate in international markets in Asia and Europe. REVENUE FROM CUSTOMERS PER GEOGRAPHIC AREA FY24 The market for skilled and experienced executives in the retail industry continues to be increasingly competitive and international in nature. The Group’s strong domestic position, as well as global reach, provides exposure to an international pool of talent and access to a diverse range of strategies to respond to industry changes. Given these structural changes and the Group’s growth focus, the Board believes it is both critical to the future success of the business, and in the best interest of shareholders, to attract, retain and develop the best possible executive team through the provision of competitive remuneration packages, and incentive arrangements which are aligned to growth and performance. The year-on-year growth in performance and shareholder value over more than a decade, is a testament to Premier’s remuneration strategy. The Group’s strategic objective is to be recognised as a leader in the retail industry and build long-term value for shareholders. The Group is committed to ensuring that executive remuneration outcomes are explicitly linked to the overall performance and success of the Group. This section illustrates this link between the Group’s strategic objectives and its executive remuneration strategies. Australia 79% New Zealand 10% Asia 4% Europe 7% Premier Investments Limited 20 REMUNERATION REPORT (AUDITED) (CONTINUED) EXECUTIVE REMUNERATION ARRANGEMENTS (CONTINUED) 3A. Remuneration principles and strategy (continued) Group Objective To be recognised as a leader in our industry and build long-term value for our shareholders. Remuneration strategy linkages to Group objective Align the interests of executives with shareholders  The remuneration framework incorporates “at- risk” components, through STI and LTI plans.  Performance is assessed against a suite of financial and non-financial measures relevant to the success of the Group and generating returns for shareholders. Attract, motivate and retain high performers  Remuneration is competitive as compared to companies of a similar size and complexity.  Longer-term remuneration frameworks and “at-risk” components encourage retention, development and a multi-year performance focus. Component Vehicle Purpose Link to performance Fixed remuneration Comprises base salary, superannuation contributions and other benefits. To provide competitive fixed remuneration with reference to the applicable role, market and relevant executive’s experience. Both the executive’s performance, and the performance of the Group, are considered during regular remuneration reviews. STI Awarded in cash. Rewards executives for their contribution to achievement of Group and business unit annual outputs and performance outcomes. Key financial metrics based primarily on Premier Retail’s earnings before interest and taxation (“EBIT”) of each business unit, as well as a suite of other internal financial and non-financial measures. LTI Awarded in performance rights. Rewards executives for their contribution to the creation of shareholder value over the long term. Vesting of performance rights is dependent on both a positive total shareholder return (“TSR”) and measuring against a Comparison Peer Group (defined in Section 3F of this report). Discretionary Bonus Awarded in cash or performance rights. Rewards executives in exceptional circumstances and/or linked to long term shareholder outcomes. Granted at the discretion of the Board upon recommendation of the Committee in exceptional circumstances, and when in the best interests of the Group. Directors’ Report continued 21 Annual Report 2024 REMUNERATION REPORT (AUDITED) (CONTINUED) 3. EXECUTIVE REMUNERATION ARRANGEMENTS (CONTINUED) 3B. Fixed remuneration objectives Fixed remuneration is reviewed by the Committee. The process consists of a review of the Group, applicable business unit and executive’s individual performance, relevant comparative remuneration (both externally and internally) and, where appropriate, external advice. The Committee has access to external advice independent of management. 3C. Group performance and its link to executive remuneration The Group is pleased to report that despite tough economic conditions, it continued to generate strong returns for shareholders. The dividends approved for the year reaffirm the confidence the Directors have in the Group’s future performance and underline Premier’s commitment to enhancing shareholder value through capital management and business investment. 2024 2023 2022 2021 2020 Closing share price at end of financial year $32.13 $22.18 $21.04 $26.84 $17.57 Basic earnings per share (cents) 161.78 170.31 179.40 171.15 86.89 Dividends per share (cents) 133.0 130.02 125.02 80.0 70.0 Return on equity (%) 14.4% 15.6%1 17.0% 17.7% 10.2% 1 Return on Equity excludes the impact of a non-cash impairment of intangible assets in FY23 ($5 million). 2 Comprising an ordinary dividend of 114 cents per share (FY22: 100 cents per share), and a special dividend of 16 cents per share. (FY22: 25 cents per share). The below chart illustrates the total return of the Premier share price against the S&P/ASX200 Accumulation Index, over the past 5 years, between 2019 and 2024, where the Group has delivered a TSR of 197%, outperforming the Index’s return of 47%. PREMIER SHARE PRICE TOTAL RETURN AGAINST ASX200 ACCUMULATION INDEX – 5 YEARS 0% 25% 50% 75% 100% 125% 150% 175% 200% .AXJOA Total Return PMV.AX Total Return Premier Investments Limited 22 REMUNERATION REPORT (AUDITED) (CONTINUED) + 94.8% on “Pre-Covid” FY19 3. EXECUTIVE REMUNERATION ARRANGEMENTS (CONTINUED) 3C. Group performance and its link to executive remuneration (continued) The below chart illustrates full year ordinary and special dividends per share (fully franked) over a 5 year period:   Premier Retail achieved another strong result in FY24 against a backdrop of challenging markets, with an EBIT of $325.9 million, a decrease of 8.6% on the record 2023 financial year. Premier Retail’s FY24 EBIT is up 94.8% on a “Pre-COVID” FY19 EBIT of $167.3 million. The following chart shows Premier Retail’s EBIT for the past 6 years.   Note: Please refer to page 11 of the Directors’ Report for a reconciliation between Premier Retail EBIT (excluding one-off and significant items) and statutory reported operating profit before tax for the Retail Segment. 70 80 100 114 133 25 16 0 20 40 60 80 100 120 140 FY20 FY21 FY22 FY23 FY24 Full year ordinary and special dividends per share (fully franked) Ordinary Special 167.3 187.2 304.3 335.0 356.5 325.9 0 50 100 150 200 250 300 350 400 FY19 (Pre-COVID) FY20 FY21 FY22 FY23 FY24 Premier Retail EBIT (comparable 52-week basis) $'million Directors’ Report continued 23 Annual Report 2024 REMUNERATION REPORT (AUDITED) (CONTINUED) 3. EXECUTIVE REMUNERATION ARRANGEMENTS (CONTINUED) 3D. Group performance and its link to STI STI payment outcomes are primarily driven by Premier Retail’s EBIT growth. The Board continuously evaluates the most appropriate STI performance hurdles and metrics for each year, ensuring that the STI component rewards the achievement of metrics most appropriate to the growth of the Group in the relevant year. For the 2024 financial year, the Group provided Mr. Bryce with an STI opportunity equivalent to 50% of his fixed remuneration, subject to the achievement of performance hurdles, based primarily on Premier Retail EBIT growth. The Board determined that no STI payment was to be made to Mr. Bryce in relation to the 2024 financial year. 3E. Group performance and its link to LTI The performance measure which drives LTI vesting is dependent on an absolute test, being a positive Premier TSR performance and a relative test, being a comparison against the Comparison Peer Group (as defined in section 3F of this report). The table below illustrates the outcomes of the TSR testing performed during the 2024 financial year in relation to KMP. Due to Premier’s strong share price performance over the past four years, where positive TSR meant the absolute test was met and the award was eligible for testing, the Group’s relative performance was above the 75th percentile against the peer group for both tranches. This resulted in vesting outcomes of 100%. Testing Period Share price at start of testing period Share price at end of testing period Dividends paid (fully franked) TSR percentage TSR percentile 1 May 2020 to 30 Sept 2023 $13.21 $25.00 $3.45 98.94% 84 1 May 2020 to 30 Apr 2024 $13.21 $30.20 $4.05 145.59% 86 Mr. Bryce was the only member of the current executive KMP participating in the 2020 LTI grant (tranche 2 and tranche 3 tested within the financial year). 3F. Detail of incentive plans Short term incentive (“STI”) The Group operates an annual STI program which is awarded subject to the attainment of clearly defined financial and non-financial Group and business unit measures. Who participates? Executives who have served a minimum of nine months. How is STI delivered? Cash. What is the STI opportunity? Executives have an STI opportunity of between 0% and 100% of their fixed remuneration. Premier Investments Limited 24 REMUNERATION REPORT (AUDITED) (CONTINUED) 3. EXECUTIVE REMUNERATION ARRANGEMENTS (CONTINUED) 3F. Detail of incentive plans (continued) Short term incentive (“STI”) (continued) What are the applicable financial performance measures? STI payments awarded to each executive are explicitly aligned to the key value drivers of Premier Retail, such that rewards are payable based on the following criteria:  target EBIT of Premier Retail and an incentive pool has been created;  the executive receives a performance appraisal on target or above;  the executive’s minimum performance outcomes have been achieved; and  the executive’s key performance indicators (“KPIs”) have been met. The financial performance measures are chosen with reference to the strategic objective to promote both short term success and provide a framework for delivering long term value. The criteria are designed to ensure STI outcomes are aligned to the creation of shareholder value. The KPI criteria aligns the individual activities and focus of the executive to creating shareholder value. Each executive is set multiple KPIs covering financial, non-financial, Group and business unit measures of performance. The KPIs are quantifiable and weighted according to their value. The target EBIT for each year is expected to incorporate growth on the previous year. As such, in a year in which STI payments are made, Premier Retail considers the actual result in the prior year in order to assess an STI in the following year. This mechanism ensures the STI scheme continues to build shareholder returns over time. What are the applicable non-financial performance measures? The award of an STI is dependent on the executive achieving individual aligned non-financial performance indicators, such as:  retention of existing customers through outstanding customer service;  implementation of key growth initiatives;  demonstrated focus on a continuous improvement in safety performance; and  demonstrated focus on the growth and development of leadership and team talent to encourage leadership succession. How is performance assessed? After the end of the financial year, following consideration of the financial and non- financial performance indicators, the Committee obtains input from the CEO Retail in relation to the amount of STI to be paid to eligible executives. The Committee then provides its recommendations to the Board for approval. The provision of any STI payments is subject to the sole discretion of the Chairman. Directors’ Report continued 25 Annual Report 2024 REMUNERATION REPORT (AUDITED) (CONTINUED) 3. EXECUTIVE REMUNERATION ARRANGEMENTS (CONTINUED) 3F. Detail of incentive plans (continued) Long-term incentive (“LTI”) Premier’s LTI plan seeks to create shareholder value over the long term by aligning executive remuneration with the Group’s strategic objectives. The majority of Premier’s LTI rights are assessed according to the performance measures described in the table below. In certain circumstances, Premier considers that the most appropriate performance condition relates to retention of key executives. In these circumstances, limited equity rights are issued to certain executives with the only performance measure relating to the executive remaining employed by the Group on the relevant vesting date. Who participates? Executives. How is LTI delivered? Performance rights. How often are grants made? One grant over multiple years. The most recent grant was made to executives in October 2022, excluding retention rights granted to the Interim CEO (Retail). What are the performance measures? The majority of LTI rights awarded to executives are subject to a two-stage performance test - an absolute and relative test - based on Premier’s TSR. Broadly, TSR is the percentage growth achieved from an investment in ordinary shares over the relevant testing period (assuming all dividends are reinvested). The two-stage performance measure approach ensures that the LTI plan operates as a key driver for performance whilst also providing an incentive to executives. The absolute test requires Premier to achieve a positive TSR over the testing period. If the TSR is negative over the testing period, then the performance rights lapse. If the TSR is positive over the testing period, the relative test is undertaken, which compares Premier’s TSR with the S&P/ASX200 excluding overseas companies and companies classified in the Energy or Materials sector (“Comparison Peer Group”). The Comparison Peer Group represents over 100 companies in the ASX200, which reflects the Group’s competitors for both capital and talent. The Comparator Peer Group consists of ASX200 companies, including companies within the consumer discretionary, consumer staple and information technology sectors. Premier’s performance against the Comparison Peer Group measure is determined according to its ranking against the Comparison Peer Group over the performance period. The vesting schedule is as follows: Target Conversion ratio of rights to shares available to vest under the TSR performance condition Below 50th percentile 0% 50th percentile 50% Between 50th and 75th percentile Pro Rata 75th percentile and above 100% Premier Investments Limited 26 REMUNERATION REPORT (AUDITED) (CONTINUED) 3. EXECUTIVE REMUNERATION ARRANGEMENTS (CONTINUED) 3F. Detail of incentive plans (continued) Long-term incentive (“LTI”) (continued)  What are the performance measures (continued)? The absolute test (or gateway) ensures that shareholders and executives are aligned in the goal of absolute wealth creation. The relative test provides alignment between comparative shareholder return and reward for executives. The performance rights under each tranche will lapse if the applicable performance hurdles are not met (unless otherwise determined by the Board in its absolute discretion). Premier considers the suitability of the above performance conditions on a regular basis. How is performance assessed? TSR performance is calculated by an independent external advisor at the end of each performance period. Section 8 of this report, titled “Additional disclosures relating to rights and shares”, provides details of performance rights granted, vested, exercised and lapsed during the year. When does the LTI vest? For rights issued in the most recent grant during 2022, the performance rights will vest in accordance with the following schedule: Tranche 1: LTI rights will be tested for vesting from 1 October 2022 to 1 October 2025 (being the 1st Vesting Date). Tranche 2: LTI rights will be tested for vesting from 1 October 2022 to 1 October 2026 (being the 2nd Vesting Date). Tranche 3: LTI rights will be tested for vesting from 1 October 2022 to 1 October 2027 (being the 3rd Vesting Date). Performance rights have no opportunity to be re-tested. How are grants treated on termination? Generally, all rights (whether vested or unvested) lapse and terminate on cessation of employment. May participants enter into hedging arrangements? Executives are prohibited from entering into transactions to hedge or limit the economic risk of the securities allocated to them under the LTI scheme, either before vesting or after vesting while the securities are held subject to restriction. Executives are only able to hedge securities that have vested but continue to be subject to a trading restriction and a seven-year lock, with the prior consent of the Board. No employees have any hedging arrangements in place. Are there restrictions on disposals? Once rights have been allocated, disposal of performance shares is subject to restrictions whereby Board approval is required to sell shares granted within seven years under the LTI plan. Do participants receive distributions or dividends on unvested LTI grants? Participants do not receive distributions or dividends on unvested LTI grants. Directors’ Report continued 27 Annual Report 2024 REMUNERATION REPORT (AUDITED) (CONTINUED) 4.1 REMUNERATION OF OUTGOING CEO (RETAIL), MR. MURRAY Mr. Murray resigned as CEO (Retail) effective 15 September 2023 and resigned as Executive Director of Premier effective 21 August 2023. In accordance with his contract of employment dated 27 April 2021, Mr. Murray was required to provide 12 months’ notice of termination (“Notice Period”) if he resigned. The maximum amount of any payment in lieu of the Notice Period based on Mr. Murray’s total fixed remuneration for a 12-month period was $2,000,000 gross, less applicable tax. On 15 September 2023, Premier elected to provide Mr. Murray with a payment in lieu of the relevant Notice Period. Mr. Murray was not eligible to receive an FY24 STI award. As a result of the cessation of his employment, Mr. Murray’s unvested once-off sign-on retention performance rights (100,000 rights) and his LTI rights (600,000 rights) lapsed. Premier elected not to enforce post-employment restrictions which would restrict Mr. Murray from certain conduct in competition with Premier. 4.2 FY24 REMUNERATION OF INTERIM CEO (RETAIL), MR. BRYCE Mr. John Bryce was appointed as Interim CEO (Retail) and Chief Financial Officer, Just Group Limited, in August 2023, with a further extension announced on 26 July 2024. The material terms of Mr. Bryce’s employment arrangement as Interim CEO (Retail) and CFO as provided to the ASX on 26 July 2024, are summarised below: Term of agreement Mr. Bryce will continue in the position of Interim Chief Executive Officer (Retail) and Chief Financial Officer until 25 July 2025, or when the Board appoints a new Chief Executive Officer, whichever is earlier. Fixed Remuneration Mr Bryce will continue to receive $1,000,000 per annum during the period in which he is engaged in the position of Interim CEO (Retail) and Chief Financial Officer. Retention Bonus The Company granted Mr. Bryce 25,000 performance rights as a retention award. The performance rights will be tested, and if applicable, will vest on 25 July 2025. Vesting of the performance rights is subject to Mr. Bryce being actively employed, and not serving a period of notice at all times between the date of granting the performance rights and the vesting date. If vested, each performance right is an entitlement to a fully paid ordinary share of the Company (Performance Shares). The performance rights are subject to the terms and conditions of the Company’s Performance Rights Plan Rules (Rules). In accordance with the Rules, disposal of Performance Shares is subject to restrictions whereby Board approval is required to sell shares granted within 7 years. 5. EXECUTIVE SERVICE AGREEMENTS Remuneration and other terms of employment for KMP and other executives are formalised in written service agreements (with the exception of Ms. Meyer, whose relevant terms of employment are set out below). Material provisions of the service agreements are set out below: Start date Term of agreement Review period Notice period required from Premier Notice period required from employee Mr. Bryce 13 Dec 2016 Ongoing Annual 12 months 12 months * Ms. Meyer 4 Feb 2019 Ongoing Annual 12 months 12 months * If Mr. Bryce gives notice of termination, then his notice period may be extended to delay the date on which his termination becomes effective, by a period of up to six months. Premier Investments Limited 28 REMUNERATION REPORT (AUDITED) (CONTINUED) 6. NON-EXECUTIVE DIRECTOR REMUNERATION ARRANGEMENTS Determination of fees and maximum aggregate Non-Executive Director Remuneration The Board seeks to set Non-Executive Director fees at a level which provides the Group with the ability to attract and retain Non-Executive Directors of the highest calibre, whilst incurring a cost which is acceptable to shareholders. The Group’s constitution and the ASX listing rules specify that the Non-Executive Director maximum aggregate remuneration shall be determined from time to time by a general meeting. The most recent determination of this kind was at the 2023 Annual General Meeting held on 1 December 2023 when shareholders approved an aggregate remuneration of an amount not exceeding $2,000,000 per year. The Chairman of the Group, consistent with his past practice, has declined to accept any remuneration for his role as a director or for his role on any committees. Fee policy Non-Executive Director’s fees consist of base fees and committee fees. The payment of committee fees recognises the additional time commitment required by Non-Executive Directors who serve on Board committees. Non-Executive Directors may be reimbursed for expenses reasonably incurred in attending to the Group’s affairs. Non- Executive Directors do not participate in any incentive programs. Premier has not established any schemes for retirement benefits for Non-Executive Directors (other than superannuation). REMUNERATION REPORT (AUDITED) (CONTINUED) 7. REMUNERATION OF KEY MANAGEMENT PERSONNEL (KMP) Details of the nature and amount of each element of compensation for services for KMP of the Group related to the financial year are as follows: Short-term Share based 2024 Salary/Fee/ Allowances Cash Superannuation Long-term incentives Total Performance related $ $ $ $ $ % Non-Executive Directors Mr. S. Lew - - - - - - Mr. T. Antonie 160,000 - - - 160,000 - Dr. D. Crean 180,113 - 19,887 - 200,000 - Ms. S. Falzon 140,000 - - - 140,000 - Ms. S Herman 140,000 - - - 140,000 - Mr. H. D. Lanzer1 140,000 - - - 140,000 - Mr. T.L. McCartney 360,000 - - - 360,000 - Mr. M. R. I. McLeod 144,090 - 15,910 - 160,000 - Ms. A Weiss2 79,032 - - - 79,032 - Total Non-Executive Directors 1,343,235 - 35,797 - 1,379,032 - Executives - - Mr. R. Murray3 2,090,867 - 4,567 65,114 2,160,548 - Mr. J. Bryce 959,709 - 27,610 650,155 1,637,474 40% Ms. M. Meyer 409,390 125,000 30,610 217,121 782,121 44% Total executives 3,459,966 125,000 62,787 932,390 4,580,143 TOTAL 2024 4,803,201 125,000 98,584 932,390 5,959,175 1 Mr. Lanzer’s director’s fees were paid to Arnold Bloch Leibler. 2 Ms. Weiss was appointed as a Non-Executive Director effective 4 December 2023. 3 Mr. Murray resigned as CEO (Retail) effective 15 September 2023. The above table includes payment made in lieu of Mr. Murray’s Notice Period, as described in section 4.1 of the Remuneration Report. As a result of Mr. Murray ceasing employment, previously recognised Long-term Incentives expenses totalling $5,830,440 were reversed in FY24 due to the vesting conditions not being met. Directors’ Report continued 29 Annual Report 2024 Premier Investments Limited 30 REMUNERATION REPORT (AUDITED) (CONTINUED) 7. REMUNERATION OF KMP (CONTINUED) Short-term Share based 2023 Salary/Fee/ Allowances Cash Superannuation Long-term incentives Total Performance related $ $ $ $ $ % Non-Executive Directors Mr. S. Lew - - - - - - Mr. T. Antonie 160,000 - - - 160,000 - Dr. D. Crean 180,928 - 19,072 - 200,000 - Ms. S. Falzon 140,000 - - - 140,000 - Ms. S Herman 140,000 - - - 140,000 - Mr. H. D. Lanzer1 140,000 - - - 140,000 - Mr. T.L. McCartney 360,000 - - - 360,000 - Mr. M. R. I. McLeod 144,742 - 15,258 - 160,000 - Total Non-Executive Directors 1,265,670 - 34,330 - 1,300,000 Executives Mr. R. Murray 1,973,520 750,000 25,468 4,261,494 7,010,482 71% Mr. J. Bryce 624,568 - 25,468 129,335 779,371 17% Ms. M. Meyer 374,532 50,000 25,468 162,842 612,842 35% Total executives 2,972,620 800,000 76,404 4,553,671 8,402,695 TOTAL 2023 4,238,290 800,000 110,734 4,553,671 9,702,695 1 Mr. Lanzer’s director’s fees were paid to Arnold Bloch Leibler. Directors’ Report continued 31 Annual Report 2024 REMUNERATION REPORT (AUDITED) (CONTINUED) 8. ADDITIONAL DISCLOSURES RELATING TO RIGHTS AND SHARES OF KMP a) Rights awarded, vested and lapsed during the year: The table below discloses the number of performance rights granted to KMP as remuneration for the financial year ended 27 July 2024, as well as the number of rights vested during the year: Terms and Conditions 2024 Rights granted during the year No. Grant date Fair value per right at grant date $ Expiry and Exercise date Rights vested No. Mr. R. Murray - Dec-21 - - 50,000 Mr. J. Bryce - May-20 - - 17,032 25,000 Aug-23 $21.11 - 25,000 25,000 Jul-24 $30.80 - - Ms. M. Meyer - - - - - 700,000 rights lapsed during the financial year ended 27 July 2024 in relation to Mr. Murray. b) Value of rights awarded, exercised and lapsed during the year: 2024 Value of rights granted during the year $ Value of rights exercised during the year $ Remuneration consisting of rights for the year % Mr. R. Murray - 1,272,500 - Mr. J. Bryce 1,297,750 1,240,887 40% There were no alterations to the terms and conditions of rights awarded as remuneration since their award date. The value of rights exercised during the year represent the intrinsic value of the rights based on the share price on the relevant day of vesting. c) Shares issued on exercise of rights: 2024 Shares issued No Paid per share $ Unpaid per share $ Alterations to terms and conditions of rights awarded since award date Mr. R. Murray 50,000 - - No Mr. J. Bryce 42,032 - - No d) Rights holdings of KMP: 2024 Balance at 29 July 2023 Granted as remuneration Rights exercised Lapsed Balance at 27 July 2024 (not exercisable) Mr. R. Murray 750,000 - (50,000) (700,000) - Mr. J. Bryce 55,351 50,000 (42,032) - 63,319 Ms. M. Meyer 45,000 - - - 45,000 Rights granted to KMP were made in accordance with the provisions of the Group’s Performance Rights Plan. Premier Investments Limited 32 REMUNERATION REPORT (AUDITED) (CONTINUED) 8. ADDITIONAL DISCLOSURES RELATING TO RIGHTS AND SHARES OF KMP (CONTINUED) e) Number of Ordinary Shares held in Premier Investments Limited by KMP: 2024 Balance at 29 July 2023 Movement in shareholdings Balance at 27 July 2024 NON-EXECUTIVE DIRECTORS Mr. S. Lew * 4,437,699 - 4,437,699 Mr. T. Antonie 5,001 - 5,001 Dr. D.M. Crean - - - Ms. S. Falzon - - - Ms. S. Herman 11,500 - 11,500 Mr. H.D. Lanzer 27,665 - 27,665 Mr. T.L. McCartney - - - Mr. M.R.I. McLeod 28,186 - 28,186 Ms. A Weiss - - - EXECUTIVES Mr. R. Murray** 50,000 (50,000) - Mr. J. Bryce 23,417 42,032 65,449 Ms. M. Meyer 20,000 - 20,000 TOTAL 4,603,468 (7,968) 4,595,500 * Mr. Lew is an associate of Century Plaza Investments Pty. Ltd. and Metrepark Pty. Ltd (Associated Entities). The Associated Entities, collectively, have a relevant interest in 59,804,731 (2023: 59,804,731) shares in the company. However, Mr. Lew does not have a relevant interest in the shares in the company held by the Associated Entities. ** Mr. Murray resigned as CEO (Retail) effective 15 September 2023 and ceased being a KMP as of that date. 9. ADDITIONAL DISCLOSURES RELATING TO TRANSACTIONS AND BALANCES WITH KMP AND THEIR RELATED PARTIES Mr. Lanzer is the managing partner of the legal firm Arnold Bloch Leibler. Group companies use the services of Arnold Bloch Leibler from time to time. Legal services totalling $3,221,654 (2023: $1,695,213), including Mr. Lanzer's Director fees, GST and disbursements were invoiced by Arnold Bloch Leibler to the Group, with $972,623 (2023: $234,282) remaining outstanding at year-end. The fees paid for these services were at arm's length and on normal commercial terms.   Mr. Lanzer is a director of Loch Awe Pty Ltd. During the year, lease payments totalling $240,167 (2023: $240,167) including GST was paid to Loch Awe Pty Ltd, with $nil outstanding rent payments at year-end (2023: $nil). The payments were at arm’s length and on normal commercial terms. Mr. Lew is a director of Voyager Distributing Company Pty Ltd. During the year, purchases totalling $18,821,591 (2023: $25,652,581) including GST have been made by Group companies from Voyager Distributing Co. Pty Ltd, with $3,101,224 (2023: $3,820,631) remaining outstanding at year-end. The purchases were all at arm’s length and on normal commercial terms. Directors’ Report continued 33 Annual Report 2024 REMUNERATION REPORT (AUDITED) (CONTINUED) 9. ADDITIONAL DISCLOSURES RELATING TO TRANSACTIONS AND BALANCES WITH KMP AND THEIR RELATED PARTIES (CONTINUED) Mr. Lew is a director of Century Plaza Trading Pty. Ltd. The Company and Century Plaza Trading Pty Ltd are parties to a Services Agreement to which Century Plaza Trading agrees to provide certain administrative services to the company to the extent required and requested by the company. The Company is required to reimburse Century Plaza Trading for costs it incurs in providing the company with the services under the Service Agreement. The company reimbursed a total of $632,500 (2023: $434,500) costs including GST incurred by Century Plaza Trading Pty Ltd, with $nil (2023: $nil) outstanding at year-end. Ballook Pty Ltd is a company associated with Mr Lew. During the year, Just Group Limited entered into a property lease for warehousing space in Footscray. The lease commencement date was 1 July 2024, with an expiry date of 31 October 2026. The annual rent agreed to is $1,155,000 inclusive of GST, and Just Group Limited is responsible for all outgoings in relation to the area leased. The lease was entered into at arm’s length and on normal commercial terms. The lease is accounted for under AASB 16 Leases in the financial statements. Amounts recognised in the financial report at the reporting date in relation to other transactions: i) Amounts included within Assets and Liabilities 2024 $’000 Non-Current Assets Right of Use Asset 2,000 Non-Current Liabilities Lease liabilities 1,274 Current Liabilities Trade and other payables 4,074 Lease liabilities 803 ii) Amounts included within Profit or Loss 2024 $’000 Expenses Purchases/ Cost of goods sold 17,275 Depreciation of non-current assets 291 Finance costs 14 Legal fees 2,929 Other expenses 575 Total expenses 21,084 Auditor’s Independence Declaration Premier Investments Limited 34 Ernst & Young 8 Exhibition Street Melbourne VIC 3000 Australia GPO Box 67 Melbourne VIC 3001 Tel: +61 3 9288 8000 Fax: +61 3 8650 7777 ey.com/au Audit or’s independence declarat ion t o t he direct ors of Premier Invest ment s Limit ed As lead auditor for the audit of the financial report of Premier Investments Limited for the financial year ended 27 July 2024, I declare to the best of my knowledge and belief, there have been: a. No contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; b. No contraventions of any applicable code of professional conduct in relation to the audit; and c. No non-audit services provided that contravene any applicable code of professional conduct in relation to the audit. This declaration is in respect of Premier Investments Limited and the entities it controlled during the financial year. Ernst & Young Glenn Carmody Partner 24 September 2024 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation For the 52 weeks ended 27 July 2024 and 29 July 2023 Statement of Comprehensive Income 35 Annual Report 2024 CONSOLIDATED NOTES 2024 $’000 2023 $’000 Revenue from contracts with customers 4 1,595,326 1,643,502 Other revenue 4 22,243 19,022 Total revenue 1,617,569 1,662,524 Other income 4 1,892 2,029 Total revenue and other income 1,619,461 1,664,553 Changes in inventories (597,294) (621,011) Employee expenses (385,294) (383,091) Lease rental expenses 5 (36,127) (43,756) Depreciation and impairment of non-current assets 5 (166,042) (165,222) Advertising and direct marketing (25,028) (24,569) Finance costs 5 (30,176) (16,513) Other expenses (67,822) (59,118) Total expenses (1,307,783) (1,313,280) Share of profit of associates 19 42,411 30,864 Profit from continuing operations before income tax 354,089 382,137 Income tax expense 6 (96,167) (111,059) Net profit for the period attributable to owners 257,922 271,078 Other comprehensive income (loss) Items that may be reclassified subsequently to profit or loss Net (loss) gain on cash flow hedges 23 (578) 491 Foreign currency translation 23 (339) 5,814 Net movement in other comprehensive income of associates 23 (3,664) 4,809 Income tax on items of other comprehensive loss (income) 6 173 (147) Other comprehensive (loss) income which may be reclassified to profit or loss in subsequent periods, net of tax (4,408) 10,967 Items not to be reclassified subsequently to profit or loss Net fair value gain on listed equity investment 23 - 29,165 Income tax on items of other comprehensive income 6 - (17,356) Other comprehensive income not to be reclassified to profit or loss in subsequent periods, net of tax - 11,809 TOTAL COMPREHENSIVE INCOME FOR THE PERIOD ATTRIBUTABLE TO THE OWNERS 253,514 293,854 Earnings per share from continuing operations attributable to the ordinary equity holders of the parent: - basic, profit for the year (cents per share) 7 161.78 170.31 - diluted, profit for the year (cents per share) 7 160.79 168.59 The accompanying notes form an integral part of this Statement of Comprehensive Income. Statement of Financial Position As at 27 July 2024 and 29 July 2023 Premier Investments Limited 36 CONSOLIDATED NOTES 2024 $’000 2023 $’000 ASSETS Current assets Cash and cash equivalents 20 409,481 417,647 Trade and other receivables 9 15,725 12,678 Income tax receivable 2,930 12,214 Inventories 10 217,852 231,157 Other financial instruments 24 - 577 Other current assets 11 16,042 13,042 Total current assets 662,030 687,315 Non-current assets Property, plant and equipment 17 147,142 128,495 Right-of-use assets 12 375,330 389,739 Intangible assets 18 822,785 822,363 Deferred tax assets 6 8,041 10,135 Investments in associates 19 508,205 458,775 Total non-current assets 1,861,503 1,809,507 TOTAL ASSETS 2,523,533 2,496,822 LIABILITIES Current liabilities Trade and other payables 13 120,509 127,264 Income tax payable 4,979 1,875 Lease liabilities 14 138,602 153,045 Provisions 15 39,335 39,505 Other current liabilities 16 12,057 14,307 Total current liabilities 315,482 335,996 Non-current liabilities Interest-bearing liabilities 21 69,000 69,000 Deferred tax liabilities 6 60,372 57,346 Lease liabilities 14 270,670 277,287 Provisions 15 12,487 15,857 Total non-current liabilities 412,529 419,490 TOTAL LIABILITIES 728,011 755,486 NET ASSETS 1,795,522 1,741,336 EQUITY Contributed equity 22 608,615 608,615 Reserves 23 18,204 25,696 Retained earnings 1,168,703 1,107,025 TOTAL EQUITY 1,795,522 1,741,336 The accompanying notes form an integral part of this Statement of Financial Position. Statement of Cash Flows For the 52 weeks ended 27 July 2024 and 29 July 2023 37 Annual Report 2024 CONSOLIDATED NOTES 2024 $’000 2023 $’000 CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers (inclusive of GST) 1,768,675 1,823,370 Payments to suppliers and employees (inclusive of GST) (1,275,060) (1,317,480) Interest received 20,127 13,610 Borrowing costs paid (8,468) (5,742) Interest on lease liabilities (21,623) (10,705) Income taxes paid (76,521) (143,998) NET CASH FLOWS FROM OPERATING ACTIVITIES 20(b) 407,130 359,055 CASH FLOWS FROM INVESTING ACTIVITIES Dividends received from listed equity investment - 4,695 Dividends received from investments in associates 20,955 27,894 Payment for trademarks (422) (136) Purchase of investments (34,735) (34,400) Payment for property, plant and equipment (28,739) (16,315) NET CASH FLOWS USED IN INVESTING ACTIVITIES (42,941) (18,262) CASH FLOWS FROM FINANCING ACTIVITIES Equity dividends paid (196,244) (237,244) Payment of lease liabilities (176,556) (161,754) Proceeds of borrowings 278,260 188,376 Repayment of borrowings (278,260) (188,376) NET CASH FLOWS USED IN FINANCING ACTIVITIES (372,800) (398,998) NET DECREASE IN CASH HELD (8,611) (58,205) Cash at the beginning of the financial year 417,647 471,273 Net foreign exchange difference 445 4,579 CASH AT THE END OF THE FINANCIAL YEAR 20(a) 409,481 417,647 The accompanying notes form an integral part of this Statement of Cash Flows. For the 52 weeks ended 27 July 2024 and 29 July 2023 Statement of Changes in Equity Premier Investments Limited 38 CONSOLIDATED CONTRIBUTED EQUITY CAPITAL PROFITS RESERVE PERFORMANCE RIGHTS RESERVE CASH FLOW HEDGE RESERVE FOREIGN CURRENCY TRANSLATION RESERVE FAIR VALUE RESERVE RETAINED PROFITS TOTAL $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 At 30 July 2023 608,615 464 34,520 405 19,227 (28,920) 1,107,025 1,741,336 Net profit for the period - - - - - 257,922 257,922 Other comprehensive income - - - (405) (4,003) - - (4,408) Total comprehensive income for the period - - - (405) (4,003) - 257,922 253,514 Transactions with owners in their capacity as owners: Share-based payments - - (3,084) - - - - (3,084) Dividends paid - - - - - - (196,244) (196,244) Balance as at 27 July 2024 608,615 464 31,436 - 15,224 (28,920) 1,168,703 1,795,522 At 31 July 2022 608,615 464 27,313 61 8,604 (40,729) 1,073,191 1,677,519 Net profit for the period - - - - - - 271,078 271,078 Other comprehensive income - - - 344 10,623 11,809 - 22,776 Total comprehensive income for the period - - - 344 10,623 11,809 271,078 293,854 Transactions with owners in their capacity as owners: Share-based payments - - 7,207 - - - - 7,207 Dividends paid - - - - - - (237,244) (237,244) Balance as at 29 July 2023 608,615 464 34,520 405 19,227 (28,920) 1,107,025 1,741,336 The accompanying notes form an integral part of this Statement of Changes in Equity Notes to the Financial Statements For the 52 weeks ended 27 July 2024 and 29 July 2023 39 Annual Report 2024 1 GENERAL INFORMATION The financial report contains the consolidated financial statements of the consolidated entity, comprising Premier Investments Limited (the ‘parent entity’) and its wholly owned subsidiaries (‘the Group’) for the 52 weeks ended 27 July 2024. The financial report was authorised for issue by the Directors on 24 September 2024. Premier Investments Limited is a for profit company limited by shares incorporated in Australia whose shares are publicly traded on the Australian Securities Exchange. The nature of the operations and principal activities of the Group are described in the Directors’ Report. The notes to the financial statements have been organised into the following sections: (i) Other material group accounting policies: Summarises the basis of financial statement preparation and other accounting policies adopted in the preparation of these consolidated financial statements. Specific accounting policies are disclosed in the note to which they relate. (ii) Group performance: Contains the notes that focus on the results and performance of the Group. (iii) Operating assets and liabilities: Provides information on the Group’s assets and liabilities used to generate the Group’s performance. (iv) Capital invested: Provides information on the capital invested which allows the Group to generate its performance. (v) Capital structure and risk management: Provides information on the Group’s capital structure and summarises the Group’s Risk Management policies. (vi) Group structure: Contains information in relation to the Group’s structure and related parties. (vii) Other disclosures: Summarises other disclosures which are required in order to comply with Australian Accounting Standards and other authoritative pronouncements. 2 OTHER MATERIAL GROUP ACCOUNTING POLICIES The consolidated financial report is prepared for the 52 weeks from 30 July 2023 to 27 July 2024. Below is a summary of material group accounting policies applicable to the Group which have not been disclosed elsewhere. The notes to the financial statements, which contain detailed accounting policy notes, should be read in conjunction with the below Group accounting policies. (a) BASIS OF FINANCIAL REPORT PREPARATION The financial report is a general-purpose financial report, which has been prepared in accordance with the requirements of the Corporations Act 2001, Australian Accounting Standards and other authoritative pronouncements of the Australian Accounting Standards Board. The financial report has been prepared on a historical cost basis, except for other financial instruments, which have been measured at fair value as explained in the relevant accounting policies throughout the notes. The financial report is presented in Australian dollars and all values are rounded to the nearest thousand dollars ($’000), unless otherwise stated, as the Company is of a kind referred to in ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191, dated 24 March 2016. (b) STATEMENT OF COMPLIANCE The financial report complies with Australian Accounting Standards and International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). Premier Investments Limited 40 2 OTHER MATERIAL GROUP ACCOUNTING POLICIES (CONTINUED) (c) BASIS OF CONSOLIDATION The consolidated financial statements are those of the consolidated entity, comprising Premier Investments Limited and its wholly owned subsidiaries as at the end of each financial year. A list of the Group’s subsidiaries is included in note 26. Subsidiaries are entities that are controlled by the Group. Control is achieved when the Group has: - Power over the investee; - Exposure, or rights, to variable returns from its involvement with the investee, and - The ability to use its power over the investee to affect its returns. All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of the Group are eliminated in full on consolidation. Investments in subsidiaries held by Premier Investments Limited are accounted for at cost in the separate financial statements of the parent entity less any impairment losses. Dividends received from subsidiaries are recorded as a component of other revenue in the separate statement of comprehensive income of the parent entity, and do not impact the recorded cost of the investment. The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. (d) COMPARATIVE AMOUNTS The current reporting period, 30 July 2023 to 27 July 2024, represents 52 weeks and the comparative reporting period is from 31 July 2022 to 29 July 2023 which represents 52 weeks. From time to time, management may change prior year comparatives to reflect classifications applied in the current year. (e) SIGNIFICANT ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS The preparation of the Group’s consolidated financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements and estimates on historical experience and on other various factors it believes to be reasonable under the circumstances, the results of which form the basis of the carrying values of assets and liabilities that are not readily apparent from other sources. Management has identified certain critical accounting policies for which significant judgements, estimates and assumptions are required. These key judgements, estimates and assumptions have been disclosed as part of the relevant notes to the financial statements. Actual results may differ from those estimated under different assumptions and conditions and may materially affect financial results or the financial position reported in future periods. (f) OFFSETTING OF FINANCIAL INSTRUMENTS Financial assets and financial liabilities are offset and the net amount is reported in the consolidated statement of financial position if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, or to realise the assets and settle the liabilities simultaneously. Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 41 Annual Report 2024 2 OTHER MATERIAL GROUP ACCOUNTING POLICIES (CONTINUED) (g) CURRENT VERSUS NON-CURRENT CLASSIFICATION The Group presents assets and liabilities in the statement of financial position based on current versus non- current classification. An asset is current when it is: - Expected to be realised or intended to be sold in the normal operating cycle, or primarily held for the purpose of trading, or is expected to be realised within twelve months after the reporting period, or; - Cash and cash equivalents unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period. All other assets are classified as non-current. A liability is current when it is: - Expected to be settled in the normal operating cycle, or primarily held for the purpose of trading, or is due to be settled within twelve months after the reporting period, or; - There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period. All other liabilities are classified as non-current. Deferred tax assets and liabilities are classified as non- current. (h) FOREIGN CURRENCY TRANSLATION Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (‘the functional currency’). Both the functional and presentation currency of the parent entity and its Australian subsidiaries is Australian dollars. Transactions in foreign currencies are initially recorded in the functional currency by applying the exchange rates ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the rate of exchange ruling at the reporting date. All exchange differences are taken to profit or loss in the statement of comprehensive income. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions. As at the reporting date the assets and liabilities of the overseas subsidiaries are translated into the presentation currency of the parent entity at the rate of exchange ruling at the reporting date and the statements of comprehensive income are translated at the weighted average exchange rates for the period. Exchange variations resulting from the translations are recognised in the foreign currency translation reserve in equity. (i) GOODS AND SERVICES TAX (GST), INCLUDING OTHER VALUE-ADDED TAXES Revenues, expenses and assets are recognised net of the amount of goods and services tax (GST) except: - When the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and - Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the statement of financial position. Cash flows are included in the statement of cash flows on a gross basis and the GST component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the taxation authority, are classified as operating cash flows. Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority. Premier Investments Limited 42 2 OTHER MATERIAL GROUP ACCOUNTING POLICIES (CONTINUED) (j) NEW ACCOUNTING STANDARDS AND INTERPRETATIONS Changes in accounting policies, disclosures, standards and interpretations The accounting policies adopted are consistent with those of the previous financial year except for new and amended Australian Accounting Standards and AASB Interpretations relevant to the Group and its operations that are effective for the current annual reporting period. The Group applied for the first-time certain standards and amendments, which are effective for annual periods beginning on or after 1 January 2023 (unless otherwise stated). The Group has not early adopted any other standard, interpretation or amendment that has been issued but is not yet effective Definition of Accounting Estimates – Amendments to AASB 108 The amendments to AASB 8 clarify the distinction between changes in accounting estimates, changes in accounting policies and the correction of errors. They also clarify how entities use measurement techniques and inputs to develop accounting estimates. The amendments did not have a material impact on the financial statements. Disclosure of Accounting Policies - Amendments to AASB 101 and AASB Practice Statement 2 The amendments to AASB 101 and IFRS Practice Statement 2 Making Materiality Judgements provide guidance and examples to help entities apply materiality judgements to accounting policy disclosures. The amendments aim to help entities provide accounting policy disclosures that are more useful by replacing the requirement for entities to disclose their ‘significant’ accounting policies with a requirement to disclose their ‘material’ accounting policies and adding guidance on how entities apply the concept of materiality in making decisions about accounting policy disclosures. The amendments have had an impact on the Group’s disclosures of accounting policies, but not on the measurement, recognition or presentation of any items in the Group’s financial statements. Deferred Tax related to Assets and Liabilities arising from a Single Transaction – Amendments to AASB 112 The amendments to AASB 112 Income Tax narrow the scope of the initial recognition exception, so that it no longer applies to transactions that give rise to equal taxable and deductible temporary differences such as leases and decommissioning liabilities. The amendments did not have a material impact on the financial statements. International Tax Reform – Pillar Two Model Rules – Amendments to AASB 112 The amendments to AASB 112 have been introduced in response to the OECD’s BEPS Pillar Two rules and include: - A mandatory temporary exception to the recognition and disclosure of deferred taxes arising from the jurisdictional implementation of the Pillar Two model rules; and - Disclosure requirements for affected entities to help users of the financial statements better understand an entity’s exposure to Pillar Two income taxes arising from that legislation, particularly before its effective date. The mandatory temporary exception – the use of which is required to be disclosed – applies immediately. The remaining disclosure requirements apply for annual reporting periods beginning on or after 1 January 2023, but not for any interim periods ending on or before 31 December 2023. The amendments did not have a material impact on the financial statements. Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 43 Annual Report 2024 2 OTHER MATERIAL GROUP ACCOUNTING POLICIES (CONTINUED) (j) NEW ACCOUNTING STANDARDS AND INTERPRETATIONS Accounting Standards and Interpretations issued but not yet effective Recently issued or amended Australian Accounting Standards and Interpretations that have been identified as those which may be relevant to the Group in future reporting periods, but are not yet effective, have not been early adopted by the Group for the reporting period ended 27 July 2024. The Group does not anticipate that the below amended standards and interpretations will have a material impact on the Group, unless otherwise stated below: - Amendments to AASB 101: Classification of Liabilities as Current or Non-current - AASB 2014-10: Sale or Contribution of Assets between an Investor and its Associate or Joint Venture. - Amendments to AASB7 & AASB9: Classification and Measurement of Financial Instruments. - Presentation and Disclosures in Financial Statement - In June 2024, the AASB issued AASB 18 Presentation and Disclosure in Financial Statement. The Group is assessing the impact of this standard which is not expected to change the recognition and measurement of items in the financial statements but may affect presentation and disclosure in the financial statements, including introducing new categories and subtotals in the statement of profit or loss, requiring the disclosure of management-defined performance measures, and changing the grouping of information in the financial statements. Premier Investments Limited 44 GROUP PERFORMANCE 3 OPERATING SEGMENTS Identification of operating segments The Group determines and presents operating segments based on the information that is internally provided and used by the chief operating decision maker in assessing the performance of the Group and in determining the allocation of resources. An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group’s other components. The operating segments are identified by management based on the nature of the business conducted, and for which discrete financial information is available and reported to the chief operating decision maker on at least a monthly basis. Segment results that are reported to the chief operating decision maker include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise mainly of corporate assets, head office expenses and income tax assets and liabilities. Reportable Segments Retail The retail segment represents the financial performance of a number of speciality retail fashion chains. Investment The investment segment represents investments in securities for both long and short term gains, dividend income and interest. Accounting policies The key accounting policies used by the Group in reporting segments internally are the same as those contained in these financial statements. Income tax expense Income tax expense is calculated based on the segment operating net profit using the Group’s effective income tax rate. It is the Group’s policy that if items of revenue and expense are not allocated to operating segments then any associated assets and liabilities are also not allocated to the segments. This is to avoid asymmetrical allocations within segments which management believe would be inconsistent. Segment capital expenditure Segment capital expenditure is the total cost incurred during the period to acquire property, plant and equipment, and intangible assets other than goodwill. The table on the following page presents revenue and profit information for operating segments for the periods ended 27 July 2024 and 29 July 2023. Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 45 Annual Report 2024 GROUP PERFORMANCE 3 OPERATING SEGMENTS (CONTINUED) (A) OPERATING SEGMENTS RETAIL INVESTMENT ELIMINATION CONSOLIDATED 2024 $’000 2023 $’000 2024 $’000 2023 $’000 2024 $’000 2023 $’000 2024 $’000 2023 $’000 REVENUE AND OTHER INCOME Revenue from contracts with customers 1,595,326 1,643,502 - - - - 1,595,326 1,643,502 Interest revenue 10,533 5,202 11,477 8,960 - - 22,010 14,162 Other revenue 180 165 197,053 202,195 (197,000) (197,500) 233 4,860 Other income 1,892 2,029 - - - - 1,892 2,029 Total revenue and other income 1,607,931 1,650,898 208,530 211,155 (197,000) (197,500) 1,619,461 1,664,553 Total revenue per the statement of comprehensive income 1,619,461 1,664,553 RESULTS Depreciation 14,803 15,793 1,507 1,505 - - 16,310 17,298 Depreciation – right-of- use asset 153,659 144,583 - - (3,927) (1,659) 149,732 142,924 Impairment of intangible asset brand names - - - 5,000 - - - 5,000 Interest expense 26,993 13,726 3,856 3,052 (673) (265) 30,176 16,513 Share of profit of associates - - 42,411 30,864 - - 42,411 30,864 Profit before income tax expense 313,940 352,515 236,971 232,050 (196,822) (202,428) 354,089 382,137 Income tax expense (96,167) (111,059) Net profit after tax per the statement of comprehensive income 257,922 271,078 RETAIL INVESTMENT ELIMINATION CONSOLIDATED 2024 $’000 2023 $’000 2024 $’000 2023 $’000 2024 $’000 2023 $’000 2024 $’000 2023 $’000 ASSETS AND LIABILITIES Segment assets 1,016,035 1,022,307 1,610,111 1,568,007 (102,613) (93,492) 2,523,533 2,496,822 Segment liabilities 589,948 617,744 152,988 143,469 (14,925) (5,727) 728,011 755,486 Capital expenditure 34,375 20,606 - - - - 34,375 20,606 Premier Investments Limited 46 GROUP PERFORMANCE 3 OPERATING SEGMENTS (CONTINUED) (B) GEOGRAPHIC AREAS OF OPERATION AUSTRALIA NEW ZEALAND ASIA EUROPE ELIMINATION CONSOLIDATED 2024 $’000 2024 $’000 2024 $’000 2024 $’000 2024 $’000 2024 $’000 REVENUE AND OTHER INCOME Revenue from contracts with customers 1,258,284 157,414 72,655 106,973 - 1,595,326 Other revenue and income 59,074 1,778 316 51 (37,084) 24,135 Total revenue and other income 1,317,358 159,192 72,971 107,024 (37,084) 1,619,461 Segment non-current assets 1,716,630 42,731 18,281 36,217 47,644 1,861,503 Capital Expenditure 29,349 1,811 826 2,389 - 34,375 AUSTRALIA NEW ZEALAND ASIA EUROPE ELIMINATION CONSOLIDATED 2023 $’000 2023 $’000 2023 $’000 2023 $’000 2023 $’000 2023 $’000 REVENUE AND OTHER INCOME Revenue from contracts with customers 1,284,730 160,713 90,204 107,855 - 1,643,502 Other revenue and income 49,170 519 127 (17) (28,748) 21,051 Total revenue and other income 1,333,900 161,232 90,331 107,838 (28,748) 1,664,553 Segment non-current assets 1,684,972 39,941 14,519 27,486 42,589 1,809,507 Capital expenditure 18,102 1,559 710 235 - 20,606 Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 47 Annual Report 2024 GROUP PERFORMANCE CONSOLIDATED 2024 $’000 2023 $’000 4 REVENUE AND OTHER INCOME REVENUE Revenue from contracts with customers 1,595,326 1,643,502 (Disaggregated revenue from contracts with customers is presented in note 3B, Operating Segments) OTHER REVENUE Dividends received from listed equity investment - 4,695 Sundry revenue 233 165 Interest received 22,010 14,162 TOTAL OTHER REVENUE 22,243 19,022 TOTAL REVENUE 1,617,569 1,662,524 OTHER INCOME Insurance proceeds 440 1,866 Income from wholesale partners 1,318 97 Other 134 66 TOTAL OTHER INCOME 1,892 2,029 TOTAL REVENUE AND OTHER INCOME 1,619,461 1,664,553 REVENUE RECOGNITION ACCOUNTING POLICY Revenue recognition occurs at the point in time when control of the goods is transferred to the customer, generally at the point of sale or on delivery of the goods. The Group estimates the value of expected customer returns that will arise as a result of the Group’s returns policy, which entitles the customer to a refund of returned unused products within the specified timeframe for the respective brands. At the same time, the Group recognises a right of return asset, being the former carrying amount of the inventory, less any expected costs to recover the goods the Group expects to be returned by customers as a result of the returns policy. The Group operates certain loyalty programmes, which allow customers to accumulate points when products are purchased, and which can be redeemed for free or discounted product once a minimum number of points have been accumulated. Loyalty points give rise to a separate performance obligation providing a material right to the customer, therefore a portion of the transaction price is allocated to the loyalty programme based on the relative stand-alone selling prices. The Group recognises a contract liability upon the sale of gift cards and recognises revenue when the customer redeems the gift card, and the Group fulfils its performance obligation. The Group also recognises revenue on the portion of unredeemed gift cards for which redemption is unlikely, known as gift card breakage. Gift card breakage is estimated and recognised as revenue in proportion to the pattern of rights exercised by customers. On expiry of the gift card, any unused funds are recognised in full as breakage. Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying amount of the financial asset. Premier Investments Limited 48 GROUP PERFORMANCE CONSOLIDATED NOTES 2024 $’000 2023 $’000 5 EXPENSES LEASE RENTAL EXPENSES Variable lease expenses 8,354 12,647 Other lease expenses 27,773 32,541 COVID-19 related rent concessions - (1,432) NET LEASE RENTAL EXPENSES 36,127 43,756 DEPRECIATION AND IMPAIRMENT OF NON-CURRENT ASSETS Depreciation of property, plant and equipment 17 16,310 17,298 Depreciation of right-of-use assets 12 149,732 142,924 Impairment of intangible asset brand names 18 - 5,000 TOTAL DEPRECIATION AND IMPAIRMENT OF NON- CURRENT ASSETS 166,042 165,222 FINANCE COSTS Interest on lease liabilities 14 21,623 10,705 Interest on bank loans and overdraft 8,553 5,808 TOTAL FINANCE COSTS 30,176 16,513 OTHER EXPENSES INCLUDE: Net loss on disposal of property, plant and equipment 141 132 Loss on investment in associate resulting from share issue 3,097 703 Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 49 Annual Report 2024 GROUP PERFORMANCE CONSOLIDATED 2024 $’000 2023 $’000 6 INCOME TAX The major components of income tax expense are: (a) INCOME TAX RECOGNISED IN PROFIT OR LOSS CURRENT INCOME TAX Current income tax charge 82,998 99,688 Adjustment in respect of current income tax of previous years - 2,070 DEFERRED INCOME TAX Relating to origination and reversal of temporary differences 13,169 9,301 INCOME TAX EXPENSE REPORTED IN THE STATEMENT OF COMPREHENSIVE INCOME 96,167 111,059 (b) STATEMENT OF CHANGES IN EQUITY Deferred income tax related to items credited directly to equity: Net deferred income tax on movements on cash-flow hedges (173) 147 Net deferred income tax on unrealised gain (loss) on listed equity investment at fair value - 17,356 INCOME TAX EXPENSE (BENEFIT) REPORTED IN EQUITY (173) 17,503 (c) RECONCILIATION BETWEEN TAX EXPENSE AND THE ACCOUNTING PROFIT BEFORE TAX MULTIPLIED BY THE GROUP’S APPLICABLE AUSTRALIAN INCOME TAX RATE Accounting profit before income tax 354,089 382,137 At the Parent Entity’s statutory income tax rate of 30% (2023: 30%) 106,227 114,641 Adjustment in respect of current income tax of previous years - 2,070 Expenditure not allowable for income tax purposes 238 3,702 Effect of different rates of tax on overseas income (2,249) (3,776) Income not assessable for tax purposes (8,110) (5,697) Other 61 119 AGGREGATE INCOME TAX EXPENSE 96,167 111,059 Premier Investments Limited 50 GROUP PERFORMANCE CONSOLIDATED 2024 $’000 2023 $’000 6 INCOME TAX (CONTINUED) (d) RECOGNISED DEFERRED TAX ASSETS AND LIABILITIES DEFERRED TAX RELATES TO THE FOLLOWING: Foreign currency balances 1,140 163 Potential capital gains tax on financial investments (77,189) (72,343) Deferred gains and losses on financial instruments - (173) Inventory provisions 354 537 Lease arrangements 9,678 7,018 Employee provisions 11,312 10,762 Property, plant and equipment (31) 2,004 Other provisions 2,177 3,365 Other 228 1,456 NET DEFERRED TAX LIABILITIES (52,331) (47,211) REFLECTED IN THE STATEMENT OF FINANCIAL POSITION AS FOLLOWS: Deferred tax assets 8,041 10,135 Deferred tax liabilities (60,372) (57,346) NET DEFERRED TAX LIABILITIES (52,331) (47,211) INCOME TAX ACCOUNTING POLICY Income tax expense comprises current tax (amounts payable or receivable within 12 months) and deferred tax (amounts payable or receivable after 12 months). Tax expense is recognised in profit or loss, unless it relates to items that have been recognised in equity as part of other comprehensive income or directly in equity. In this instance, the related tax expense is also recognised in other comprehensive income or directly in equity. Current income tax Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the tax authorities based on the current and prior period taxable income. The tax rates and tax laws used to calculate tax amounts are those that are enacted or substantially enacted by the reporting date. Deferred income tax Deferred income tax is recognised on temporary differences at the reporting date between the tax base of the assets and liabilities and their carrying amounts for financial reporting purposes based on the expected manner of recovery of the carrying value of an asset or liability. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantially enacted at the reporting date. Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 51 Annual Report 2024 GROUP PERFORMANCE 6 INCOME TAX (CONTINUED) INCOME TAX ACCOUNTING POLICY (CONTINUED) Deferred income tax liabilities are recognised for all temporary differences except: - When the deferred income tax liability arises from the initial recognition of an asset or liability in a transaction that is not a business combination, at the time of the transaction, affects neither the accounting profit nor the taxable profit or loss: and - When the taxable temporary difference is associated with investments in subsidiaries, associates and interest in joint ventures, and the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future. Deferred income tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised, except: - When the deferred tax asset arises from the initial recognition of an asset or liability in a transaction that is not a business combination, at the time of the transaction affects neither the accounting profit nor taxable profit; - When the deductible temporary difference is associated with investments in subsidiaries, associates and interest in joint ventures, in which case the deferred tax asset is only recognised to the extent that it is probable that the temporary difference will reverse in the foreseeable future and taxable profit will be available to utilise the deferred tax asset. The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised. Unrecognised deferred income tax assets are reassessed at each reporting date and recognised to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered. Tax assets and tax liabilities are offset only if a legally enforceable right exists to set off and the tax assets and tax liabilities relate to the same taxable entity and the same taxation authority. Tax consolidation Premier Investments Limited and its wholly owned Australian controlled entities have implemented a tax consolidation group. The head entity, Premier Investments Limited and the controlled entities continue to account for their own current and deferred tax amounts. The Group has applied the Group allocation approach to determining the appropriate amount of current taxes and deferred taxes to allocate to members of the tax consolidated group. The agreement provides for the allocation of income tax liabilities between the entities should the head entity default on its tax payment obligations. At reporting date the possibility of default is remote. In addition to its own current and deferred tax amounts, Premier Investments Limited also recognises the current tax liabilities (or assets) and the deferred tax assets arising from unused tax losses and unused tax credits assumed from controlled entities in the tax consolidated group. KEY ACCOUNTING ESTIMATES AND JUDGEMENTS Deferred tax assets are recognised for deductible temporary differences as management considers that it is probable that future taxable profits will be available to utilise those temporary differences. Premier Investments Limited 52 GROUP PERFORMANCE 6 INCOME TAX (CONTINUED) KEY ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED) Significant management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits together with future tax planning strategies. Assumptions about the generation of future taxable profits depend on management's estimates of future cash flows. These depend on estimates of future sales volumes, operating costs, capital expenditure, dividends and other capital management transactions. Judgements are also required about the application of income tax legislation. These judgements and assumptions are subject to risk and uncertainty, hence there is a possibility that changes in circumstances will alter expectations, which may impact the amount of deferred tax assets and deferred tax liabilities recognised in the statement of financial position and the amount of other tax losses and temporary differences not yet recognised. In such circumstances, some or all of the carrying amounts of recognised deferred tax assets and liabilities may require adjustment, resulting in a corresponding credit or charge to profit or loss in the statement of comprehensive income. CONSOLIDATED 2024 $’000 2023 $’000 7 EARNINGS PER SHARE The following reflects the income and share data used in the calculation of basic and diluted earnings per share: Net profit for the period 257,922 271,078 NUMBER OF SHARES ‘000 NUMBER OF SHARES ‘000 Weighted average number of ordinary shares used in calculating: - basic earnings per share 159,429 159,166 - diluted earnings per share 160,414 160,796 There have been no other conversions to, calls of, or subscriptions for ordinary shares or issues of potential ordinary shares since the reporting date and before the completion of this financial report. EARNINGS PER SHARE ACCOUNTING POLICY Basic earnings per share are calculated as net profit attributable to members of the parent divided by the weighted average number of ordinary shares. Diluted earnings per share is calculated as net profit attributable to members of the parent, adjusted for costs of servicing equity, the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been recognised as expenses, and other non-discretionary changes in revenue or expenses during the period that would result from the dilution of potential ordinary shares, divided by the weighted average number of ordinary shares and dilutive potential ordinary shares. Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 53 Annual Report 2024 GROUP PERFORMANCE CONSOLIDATED 2024 $’000 2023 $’000 8 A) DIVIDENDS DIVIDENDS APPROVED AND/ OR PAID Interim approved and paid during the year: Interim ordinary franked dividends: 2024: 63 cents per share (2023: 54 cents) 100,569 85,981 Special franked dividends: 2024: nil (2023: 16 cents) - 25,476 Final approved and paid during the year: Final ordinary franked dividends: 2023: 60 cents per share (2022: 54 cents) 95,675 85,981 Special franked dividends: 2023: nil (2022: 25 cents) - 39,806 TOTAL DIVIDENDS FOR THE YEAR 196,244 237,244 DIVIDENDS APPROVED AND NOT RECOGNISED AS A LIABILITY: Final franked dividend for 2024: 70 cents per share (2023: 60 cents) 111,761 95,675 The Directors of Premier Investments Limited approved a final ordinary dividend in respect of the 2024 financial year. The total amount of the final dividend is $111,761,000 (2023: $95,675,000) which represents a fully franked ordinary dividend of 70 cents per share (2023: 60 cents per share). CONSOLIDATED 2024 $’000 2023 $’000 B) FRANKING CREDIT BALANCE The amount of franking credits available for the subsequent financial year are: Franking account balance as at the end of the financial year at 30% (2023: 30%) 324,698 333,611 Franking (debits) credits that will arise from the settlement of income tax as at the end of the financial year 4,979 (12,214) Franking debits that will be used on the payment of dividends subsequent to the end of the financial year (47,898) (40,956) TOTAL FRANKING CREDIT BALANCE 281,779 280,441 The tax rate at which paid dividends have been franked is 30% (2023: 30%). Dividends approved will be franked at the rate of 30% (2023: 30%). Premier Investments Limited 54 OPERATING ASSETS AND LIABILITIES CONSOLIDATED 2024 $’000 2023 $’000 9 TRADE AND OTHER RECEIVABLES (CURRENT) Sundry debtors 15,725 12,678 TOTAL CURRENT TRADE AND OTHER RECEIVABLES 15,725 12,678 (a) Impairment losses Receivables are non-interest-bearing and are generally on 30 to 60 day terms. An allowance for credit losses is recognised based on the expected credit loss from the time the financial asset is initially recognised. Bad debts are written off when identified. No material allowance for credit losses has been recognised by the Group during the financial year ended 27 July 2024 (2023: $nil). During the year, no material bad debt expense (2023: $nil) was recognised. It is expected that sundry debtor balances will be received when due. (b) Fair value Due to the short-term nature of these receivables, their carrying value is considered to approximate their fair value. TRADE AND OTHER RECEIVABLES ACCOUNTING POLICY Trade and other receivables are classified as non-derivative financial assets and are recognised initially at their transaction value. After initial measurement, these assets are measured at amortised cost, less any allowance for any expected credit losses. CONSOLIDATED 2024 $’000 2023 $’000 10 INVENTORIES Finished goods 217,852 231,157 TOTAL INVENTORIES AT COST 217,852 231,157 INVENTORIES ACCOUNTING POLICY Inventories are valued at the lower of cost and net realisable value. Costs incurred in bringing each product to its present location and conditions are accounted for as follows: - Finished goods - purchase cost plus a proportion of the purchasing department, freight, handling and warehouse costs incurred to deliver the goods to the point of sale. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated direct costs necessary to make the sale. Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 55 Annual Report 2024 OPERATING ASSETS AND LIABILITIES CONSOLIDATED 2024 $’000 2023 $’000 11 OTHER ASSETS (CURRENT) Deposits and prepayments 16,042 13,042 TOTAL OTHER CURRENT ASSETS 16,042 13,042 12 RIGHT-OF-USE ASSETS Opening balance 389,739 195,558 Additions 19,900 8,861 Remeasurements 115,673 325,100 Depreciation expense (149,732) (142,924) Exchange differences (250) 3,144 TOTAL RIGHT-OF-USE ASSETS 375,330 389,739 RIGHT-OF-USE ASSETS ACCOUNTING POLICY The Group recognises right-of-use assets at the commencement date of the lease, being the date that the underlying asset is available for use. Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right- of-use assets includes the amount of lease liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement date of the lease less any lease incentives received and an estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset, restoring the site on which it is located or restoring the underlying asset to the condition required by the terms and conditions of the lease, unless those costs are incurred to produce inventories. Unless the Group is reasonably certain to obtain ownership of the leased asset at the end of the lease term, the recognised right-of-use assets are depreciated on a straight-line basis over the shorter of its estimated useful life and the lease term. Right-of-use assets are subject to impairment. KEY ACCOUNTING ESTIMATES AND ASSUMPTIONS Impairment of right-of-use assets The carrying values of the right-of-use assets are reviewed for impairment annually. If an indication of impairment exists, and where the carrying value of the asset exceeds the estimated recoverable amount, the assets or cash-generating units (CGU) are written down to their recoverable amount. The recoverable amount is the greater of fair value less costs of disposal and value-in-use. Value-in-use refers to an asset’s value based on the expected future cash flows arising from its continued use, discounted to present value using a post-tax discount rate that reflect current market assessments of the risks specific to the CGU. The recoverable amount was estimated on an individual store basis, as this has been identified as the CGU of the Group’s retail segment. No impairment loss was recognised in relation to the Group’s right-of-use assets during the current financial year (2023: $nil). Premier Investments Limited 56 OPERATING ASSETS AND LIABILITIES CONSOLIDATED 2024 $’000 2023 $’000 13 TRADE AND OTHER PAYABLES (CURRENT) Trade creditors 58,903 56,779 Other creditors and accruals 61,606 70,485 TOTAL CURRENT TRADE AND OTHER PAYABLES 120,509 127,264 (a) Fair values Due to the short-term nature of these payables, their carrying values approximate their fair values. TRADE AND OTHER PAYABLES ACCOUNTING POLICY Trade and other payables are recognised and carried at original invoice cost, which is the fair value of the consideration to be paid in the future for goods and services received whether or not billed to the Group. CONSOLIDATED 2024 $’000 2023 $’000 14 LEASE LIABILITIES Opening balance 430,332 239,281 Additions 25,727 11,335 Remeasurements 108,058 328,962 Interest expense 21,623 10,705 Payments (176,556) (161,754) COVID-19 related rent concessions - (1,432) Exchange rate differences 88 3,235 TOTAL LEASE LIABILITIES 409,272 430,332 COMPRISING OF: Current lease liability 138,602 153,045 Non-current lease liability 270,670 277,287 TOTAL LEASE LIABILITIES 409,272 430,332 LEASE LIABILITIES ACCOUNTING POLICY At the commencement date of the lease, the Group recognises lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in- substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate initially measured using the index or rate as at the commencement date, and amount expected to be paid under residual value guarantees. The variable lease payments which are not included in the measurement of the lease liability are recognised as an expense in the period in which the event or condition that triggers the payment occurs. Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 57 Annual Report 2024 OPERATING ASSETS AND LIABILITIES 14 LEASE LIABILITIES (CONTINUED) LEASE LIABILITIES ACCOUNTING POLICY (CONTINUED) In calculating the present value of lease payments, the Group uses the incremental borrowing rate at the lease commencement date, if the rate implicit in the lease cannot be readily determined, using inputs such as government bond rates for the lease period and the Group’s expected borrowing margin. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the in-substance fixed lease payments, a change in the assessment to purchase the underlying asset, or a change in the amounts expected to be payable under a residual value guarantee. The Group applies the low-value assets recognition exemption to leases of certain office equipment that are considered of low value. Lease payments on low-value assets are recognised as a lease expense on a straight- line basis over the lease term. Significant judgement in determining the lease term The Group determines the lease term as the non-cancellable term of the lease, together with any periods covered by an option to extend the lease if it is reasonably certain to be exercised, or any periods covered by an option to terminate the lease, if it is reasonably certain not to be exercised. After the lease commencement date, the Group reassesses the lease term if there is a significant event or change in circumstances that is within its control and affects its ability to exercise (or not to exercise) the option to renew. Where a lease enters holdover, the Group estimates the expected lease term based on reasonably certain information available as at balance date. Any adjustments required due to changes in estimates or entering into a new lease agreement are recognised in the period in which the adjustments are made. Significant judgement in determining the incremental borrowing rate The Group has applied judgement to determine the incremental borrowing rate, which affects the amount of lease liabilities and right-of-use assets recognised. The Group assesses and applies the incremental borrowing rate on a lease by lease basis at the relevant lease commencement date, based on the term of the lease. The incremental borrowing rate is determined using inputs including the Group’s expected lending facility margin and applicable government bond rates at the time of entering into the lease, which reflects the expected lease term. COVID-19 related rent concessions The Group has adopted the practical expedient issued by the Australian Accounting Standards Board whereby it has not accounted for rent concessions which are a direct consequence of the COVID-19 pandemic as lease modifications. Instead, the Group recognised these concessions in the statement of comprehensive income as a variable amount as and when incurred. The practical expedient may be applied where the following conditions apply: - The changed lease payments were substantially the same or less than the payments prior to the rent concession; - The reductions only affect payments which fall due before 30 June 2022; and - There has been no substantive change in the terms and conditions of the lease. Premier Investments Limited 58 OPERATING ASSETS AND LIABILITIES CONSOLIDATED 2024 $’000 2023 $’000 15 PROVISIONS CURRENT Employee entitlements – Annual Leave 18,618 17,904 Employee entitlements – Long Service Leave 13,365 12,371 Provision for make-good in relation to leased premises 5,073 5,925 Refund liability 2,088 2,088 Other provisions 191 1,217 TOTAL CURRENT PROVISIONS 39,335 39,505 NON-CURRENT Employee entitlements – Long Service Leave 3,142 2,981 Provision for make-good in relation to leased premises 8,670 10,514 Other provisions 675 2,362 TOTAL NON-CURRENT PROVISIONS 12,487 15,857 MOVEMENT IN PROVISIONS Provision for make-good in relation to leased premises Opening balance 16,439 16,117 Charged to profit or loss - 592 Utilised during the period (192) (270) Unused amounts reversed during the period (2,504) - CLOSING BALANCE (CURRENT AND NON-CURRENT) 13,743 16,439 PROVISIONS ACCOUNTING POLICIES Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. If the effect of the time-value of money is material, provisions are determined by discounting the expected future cash flows at a pre-tax discount rate that reflects the risks specific to the liability and the time value of money. Where discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost. EMPLOYEE ENTITLEMENTS ACCOUNTING POLICIES Current annual leave The provisions for employee entitlements to wages, salaries and annual leave (which are expected to be settled wholly within 12 months of the reporting date) represent the amount which the Group has a present obligation to pay, resulting from employees’ services provided up to the reporting date. The provisions have been calculated at nominal amounts based on current wage and salary rates and include related on-costs. Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 59 Annual Report 2024 OPERATING ASSETS AND LIABILITIES 15 PROVISIONS (CONTINUED) EMPLOYEE ENTITLEMENTS ACCOUNTING POLICIES (CONTINUED) Long service leave The liability for long service leave (which are not expected to be settled wholly within 12 months of the reporting date) is recognised in the provision for employee benefits and measured as the present value of expected future payments to be made in respect of services provided by employees up to the reporting date. Consideration is given to expected future wage and salary levels, experience of employee departures, and periods of service. Related on-costs have also been included in the liability. Expected future payments are discounted using market yields at the reporting date on high quality corporate bonds with terms to maturity that match as closely as possible the estimated cash outflow. Retirement benefit obligations All employees of the Group are entitled to benefits from the Group’s superannuation plan on retirement, disability or death. The Group operates a defined contribution plan. Contributions to the plan are recognised as an expense as they become payable. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payment is made available. PROVISION FOR MAKE-GOOD IN RELATION TO STORE PLANT AND EQUIPMENT ACCOUNTING POLICY A provision has been recognised in relation to make-good costs arising from contractual obligations in lease agreements, where the Group has such a present obligation. The provision recognised represents the present value of the estimated expenditure required to remove these store plant and equipment. CONSOLIDATED 2024 $’000 2023 $’000 16 OTHER LIABILITIES CURRENT Deferred income 12,057 14,307 TOTAL CURRENT 12,057 14,307 DEFERRED INCOME ACCOUNTING POLICY Unredeemed gift cards are expected to be largely redeemed within a year. Premier Investments Limited 60 CAPITAL INVESTED 17 PROPERTY, PLANT AND EQUIPMENT CONSOLIDATED LAND $’000 BUILDINGS $’000 PLANT AND EQUIPMENT $’000 CAPITAL WORKS IN PROGRESS $’000 TOTAL $’000 AT 27 JULY 2024 Cost 21,953 59,577 487,222 24,965 593,717 Accumulated depreciation and impairment - (11,885) (434,690) - (446,575) NET CARRYING AMOUNT 21,953 47,692 52,532 24,965 147,142 RECONCILIATIONS: Carrying amount at beginning of the financial year 21,953 49,197 52,876 4,469 128,495 Additions - - 8,296 26,079 34,375 Transfers between classes - - 5,583 (5,583) - Depreciation - (1,505) (14,805) - (16,310) Disposals - - (141) - (141) Exchange differences - - 723 - 723 Carrying amount at end of the financial year 21,953 47,692 52,532 24,965 147,142 AT 29 JULY 2023 Cost 21,953 59,577 478,116 4,469 564,115 Accumulated depreciation and impairment - (10,380) (425,240) - (435,620) NET CARRYING AMOUNT 21,953 49,197 52,876 4,469 128,495 RECONCILIATIONS: Carrying amount at beginning of the financial year 21,953 50,702 44,460 8,198 125,313 Additions - - 5,726 14,882 20,608 Transfers between classes - - 18,611 (18,611) - Depreciation - (1,505) (15,793) - (17,298) Disposals - - (132) - (132) Exchange differences - - 4 - 4 Carrying amount at end of the financial year 21,953 49,197 52,876 4,469 128,495 LAND AND BUILDINGS The land and buildings with a combined carrying amount of $69,645,000 (2023: $71,150,000) have been pledged to secure certain interest-bearing borrowings of the Group (refer to note 21). Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 61 Annual Report 2024 CAPITAL INVESTED 17 PROPERTY, PLANT AND EQUIPMENT (CONTINUED) PROPERTY, PLANT AND EQUIPMENT ACCOUNTING POLICY Property, plant and equipment is stated at historical cost less accumulated depreciation and any accumulated impairment losses. Depreciation is calculated on a systematic basis over the estimated useful life of the asset as follows: - Buildings 40 years - Store plant and equipment 3 to 10 years - Other plant and equipment 2 to 20 years Freehold land is not depreciated. KEY ACCOUNTING ESTIMATES AND ASSUMPTIONS Estimation of useful lives of assets The estimation of useful lives of assets has been based on historical experience as well as manufacturers’ warranties (for plant and equipment). In addition, the condition of the assets is assessed at least once per year and considered against the remaining useful life. Adjustments to useful lives are made when considered necessary and are accounted for as a change in accounting estimate, in accordance with AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors. Depreciation methods used reflect the pattern in which the asset’s future economic benefits are expected to be consumed and are reviewed at least at each financial year-end. Adjustments to depreciation methods are made when considered necessary and are accounted for as a change in accounting estimate, in accordance with AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors. Impairment testing of Property, Plant and Equipment and key accounting estimates and assumptions The carrying values of property, plant and equipment are reviewed for impairment annually. If an indication of impairment exists, and where the carrying value of the asset exceeds the estimated recoverable amount, the assets or cash-generating units (CGU) are written down to their recoverable amount. The recoverable amount is the greater of fair value less costs of disposal and value-in-use. Value-in-use refers to an asset’s value based on the estimated future cash flows arising from its continued use, discounted to present value using a post-tax discount rate that reflect current market assessments of the risks specific to the CGU. These value-in-use calculations use cash flow projections based on financial estimates covering a period of up to five years, discounting using a post-tax discount rate of 10.5% (2023: 10.5%). If an asset does not generate largely independent cash inflows, the recoverable amount is determined for the CGU to which the asset belongs. The recoverable amount was estimated for certain items of plant and equipment on an individual store basis, as this has been identified as the CGU of the Group’s retail segment. No impairment loss was recognised during the current financial year (2023: $nil). Premier Investments Limited 62 CAPITAL INVESTED 18 INTANGIBLES RECONCILIATION OF CARRYING AMOUNTS AT THE BEGINNING AND END OF THE PERIOD CONSOLIDATED GOODWILL $’000 BRAND NAMES $’000 TRADEMARKS $’000 TOTAL $’000 YEAR ENDED 27 JULY 2024 As at 30 July 2023 net of accumulated amortisation and impairment 477,085 341,179 4,099 822,363 Trademark registrations - - 422 422 As at 27 July 2024 net of accumulated amortisation and impairment 477,085 341,179 4,521 822,785 AS AT 27 JULY 2024 Cost (gross carrying amount) 477,085 376,179 4,521 857,785 Accumulated amortisation and impairment - (35,000) - (35,000) NET CARRYING AMOUNT 477,085 341,179 4,521 822,785 YEAR ENDED 29 JULY 2023 As at 31 July 2022 net of accumulated amortisation and impairment 477,085 346,179 3,963 827,227 Impairment of brand names - (5,000) - (5,000) Trademark registrations - - 136 136 As at 29 July 2023 net of accumulated amortisation and impairment 477,085 341,179 4,099 822,363 AS AT 29 JULY 2023 Cost (gross carrying amount) 477,085 376,179 4,099 857,363 Accumulated amortisation and impairment - (35,000) - (35,000) NET CARRYING AMOUNT 477,085 341,179 4,099 822,363 Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 63 Annual Report 2024 CAPITAL INVESTED 18 INTANGIBLES (CONTINUED) GOODWILL ACCOUNTING POLICY Goodwill acquired in a business combination is initially measured at cost, being the excess of the cost of the business combination over the Group’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities. Following initial recognition, goodwill is measured at cost less any accumulated impairment losses. Goodwill is not amortised but is subject to impairment testing. Goodwill is reviewed for impairment annually or more frequently if events or changes in circumstances indicate that the carrying value may be impaired. Goodwill acquired in a business combination is, from the date of acquisition, allocated to each of the Group’s cash-generating units (CGUs) that are expected to benefit from the synergies of the combination. Impairment is determined by assessing the recoverable amount of the CGU to which the goodwill relates. Where the recoverable amount of the CGU is less than the carrying amount, an impairment loss is recognised. Impairment losses recognised for goodwill are not subsequently reversed. OTHER INTANGIBLE ASSETS (excluding goodwill) ACCOUNTING POLICY Intangible assets acquired separately are initially measured at cost. Intangible assets acquired in a business combination are initially recognised at fair value. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and any accumulated impairment losses. The useful lives of intangible assets are assessed as either finite or indefinite. A summary of the key accounting policies applied to the Group’s intangible assets are as follows: Brands Trademarks & Licences Useful life assessment? Indefinite Indefinite Method used? Not amortised or revalued Not amortised or revalued Internally generated or acquired? Acquired Acquired Impairment test/recoverable amount testing Annually or more frequently if there are indicators of impairment Annually or more frequently if there are indicators of impairment Brand names, trademarks and licences are assessed as having an indefinite useful life, as this reflects management’s intention to continue to operate these to generate net cash inflows into the foreseeable future. These assets are not amortised but are subject to impairment testing. Intangible assets are tested for impairment where an indicator of impairment exists, or in the case of indefinite life intangibles, impairment is tested annually and where an indicator of impairment exists. Where the carrying amount of an intangible asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. The recoverable amount is the higher of the asset’s value-in-use and fair value less costs of disposal. Value-in use refers to an asset’s value based on the expected future cash flows arising from its continued use, discounted to present value using a post-tax discount rate that reflect current market assessments of the risks specific to the asset. If an asset does not generate largely independent cash inflows, the recoverable amount is determined for the CGU to which the asset belongs. Premier Investments Limited 64 CAPITAL INVESTED 18 INTANGIBLES (CONTINUED) SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS The recoverable amounts of CGUs are determined based on the higher of value-in-use calculations or fair value less costs of disposal. These calculations depend on management estimates and assumptions. In particular, significant estimates and judgements are made in relation to the key assumptions used in forecasting future cash flows and the expected growth rates used in these cash flow projections, as well as the discount rates applied to these cash flows. Management assesses these assumptions each reporting period and considers the potential impact of changes to these assumptions. IMPAIRMENT TESTING OF GOODWILL The key factors contributing to the goodwill relate to the synergies existing within the acquired business and also synergies expected to be achieved as a result of combining Just Group Limited with the rest of the Group. Accordingly, goodwill is assessed at a retail segment level, which is also an operating segment for the Group. The recoverable amount of the CGU has been determined based upon value-in-use calculations, using estimated cash flow scenarios for a period of five years plus a terminal value. The value-in-use calculations have been determined based on a scenario of cash flows using financial estimates for the 2025 financial year (FY25) and are projected for a further four years (FY26 – FY29) based on estimated growth rates. As part of the annual impairment test for goodwill, management assesses the reasonableness of profit margin assumptions by reviewing historical cash flow projections as well as future growth objectives. The cash flow projections for FY25 are based on financial estimates approved by senior management and the Board. These financial estimates are projected for a further four years based on average annual estimated growth rates for FY26 to FY29 of 2.23% (2023: 2.15%). Cash flow estimates beyond the five year period have been extrapolated using a growth rate ranging from 1.7% to 1.9% (2023: 1.7% to 1.9%), which reflects the long-term growth expectations beyond the five year period. The post-tax discount rate applied to these cash flow projections is 9.2% (2023: 9.6%). The discount rate has been determined using the weighted average cost of capital which incorporates both the cost of debt and the cost of capital and adjusted for risks specific to the CGU. In determining possible scenarios of cash flows, management considered the reasonably possible changes in estimated sales growth, estimated EBITDA and discount rates applied to the CGU to which goodwill relates. These reasonably possible adverse change in key assumptions on which the recoverable amount is based would not cause the carrying amount of the CGU to exceed its recoverable amount. IMPAIRMENT TESTING OF BRAND NAMES Brand names acquired through business combinations have been allocated to the following CGU groups ($’000) as no individual brand name is considered significant: - Casual wear - $153,975 - Women’s wear - $137,744 - Non Apparel - $49,460 The recoverable amounts of brand names acquired in a business combination have been determined on an individual brand basis based upon value-in-use calculations. The value-in-use calculations have been determined based upon the relief from royalty method using cash flow estimates for a period of five years plus a terminal value. Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 65 Annual Report 2024 CAPITAL INVESTED 18 INTANGIBLES (CONTINUED) IMPAIRMENT TESTING OF BRAND NAMES (CONTINUED) The recoverable amount of brand names has been determined based upon value-in-use calculations, using estimated cash flow scenarios for a period of five years plus a terminal value. The value-in-use calculations have been determined based on a scenario of cash flows using financial estimates for the 2025 financial year (FY25) and are projected for a further four years (FY26 – FY29) based on estimated growth rates. The cash flow projections for FY25 are based on financial estimates approved by senior management and the Board. These financial estimates are projected for a further four years based on average annual estimated growth rates for FY26 to FY29. These extrapolated growth rate ranges at which cash flows have been estimated for the individual brands within each of the CGU groups were 2% to 2.5% (2023: 2% - 2.3%). Cash flow estimates beyond the five year period have been extrapolated using a growth rate ranging from 1.7% to 1.9% (2023: 1.7% to 1.9%), which reflects the long-term growth expectations beyond the five year period. The post-tax discount rate applied to the cash flow projections for each of the three CGU groups is 8.2% (2023: 8.5%). The discount rate has been determined using the weighted average cost of capital which incorporates both the cost of debt and cost of capital and adjusted for risks specific to the CGU. Royalty rates have been determined for each brand within the CGU groups by considering the brand’s history and future expected performance. Factors such as the profitability of the brand, market share, brand recognition and general conditions in the industry have also been considered in determining an appropriate royalty rate for each brand. Consideration is also given to the industry norms relating to royalty rates by analysing market derived data for comparable brands and by considering the notional royalty payments as a percentage of the divisional earnings before interest and taxation generated by the division in which the brand names are used. Net royalty rates applied across the three CGU groups range between 3.5% and 8% (2023: 3.5% and 8%). In addition, management has considered reasonably possible adverse changes in key assumptions applied to brands within the relevant CGU groups, each of which have been subjected to sensitivities. Key assumptions relate to estimated sales growth, net royalty rates and discount rates applied. A brand within the Casual Wear CGU group with a carrying value of $77.2 million, indicated sensitivity to possible adverse changes to the post-tax discount rate applied to the cash flow estimates, as well as indicating sensitivity to a possible adverse change in sales growth expectations. Reasonably possible changes in key assumptions relating to a 5% reduction in estimated sales growth projections, or a discount rate increase of 50 basis points may lead to a potential impairment loss of up to $3.6 million, which is not considered material to the overall recoverable amount of the CGU. The brand names were acquired through the acquisition of the Just Group in 2008, and the historical carrying values assigned to the brands were reflective of trading performance and the retail environment over 15 years ago. The accounting standards do not allow for a re-allocation of the carrying values of indefinite-life intangible assets, therefore the significant value created within the collective portfolio of brands subsequent to 2008 is not reflected in the historical carrying values of these intangible assets. No impairment loss was recognised during the current financial year (2023: $5 million). Premier Investments Limited 66 CAPITAL INVESTED 19 INVESTMENTS IN ASSOCIATES CONSOLIDATED 2024 $’000 2023 $’000 Movements in carrying amounts Carrying amount at the beginning of the financial year 458,775 312,201 Fair value of investment in Myer Holdings Limited on commencement of equity accounting - 117,372 Share of profit after income tax 42,411 30,864 (Loss) resulting from associate share issue (3,097) (703) Share of other comprehensive income (loss) (3,664) 4,810 Acquisition of additional shareholding in associate 34,735 22,125 Dividends received (20,955) (27,894) TOTAL INVESTMENTS IN ASSOCIATES 508,205 458,775 Breville Group Limited As at 27 July 2024, Premier Investments Limited holds 25.45% (2023: 25.56%) of Breville Group Limited (“BRG”), a company incorporated in Australia whose shares are quoted on the Australian Securities Exchange. The principal activities of BRG involves the innovation, development, marketing and distribution of small electrical appliances. There were no impairment losses relating to the investment in BRG and no capital commitments or other commitments relating to the associate. The Group’s share of the profit after tax in its investment in BRG for the year was $30,157,079 (2023: $28,169,165). As at 27 July 2024, the carrying amount of the Group’s investment in BRG for the year was $347,173,278 (2023: $333,666,398), and the fair value of the Group’s interest in BRG as determined based on the quoted market price was $981,472,577 (2023: $829,269,503). During the period, a loss of $1,511,000 (29 July 2023: loss of $703,234) was recorded in the profit and loss resulting from an issue of shares by BRG, and the corresponding impact on the Group’s method of equity accounting. The Group received dividends amounting to $11,497,000 from BRG during the year (2023: $10,950,000). The financial year end date of BRG is 30 June. For the purpose of applying the equity method of accounting, the financial statements of BRG for the year ended 30 June 2024 have been used. The accounting policies applied by BRG in their financial statements materially conform to those used by the Group for like transactions and events in similar circumstances. Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 67 Annual Report 2024 CAPITAL INVESTED 19 INVESTMENTS IN ASSOCIATES (CONTINUED) Breville Group Limited (Continued) The following table illustrates summarised financial information relating to the Group’s investment in BRG: EXTRACT OF BRG’S STATEMENT OF FINANCIAL POSITION 30 JUNE 2024 $’000 30 JUNE 2023 $’000 Current assets 764,010 820,818 Non-current assets 577,061 554,034 Total assets 1,341,071 1,374,852 Current liabilities (337,944) (321,772) Non-current liabilities (154,913) (283,421) Total liabilities (492,857) (605,193) NET ASSETS 848,214 769,659 Group’s share of BRG net assets 215,870 196,725 EXTRACT OF BRG’S STATEMENT OF COMPREHENSIVE INCOME 30 JUNE 2024 $’000 30 JUNE 2023 $’000 Revenue 1,529,993 1,478,554 Profit after income tax 118,507 110,208 Other comprehensive income (9,706) 20,262 Group’s share of BRG profit after income tax 30,157 28,169 Myer Holdings Limited As at 27 July 2024, Metalgrove Pty Ltd, a subsidiary of Premier Investments Limited, holds 31.37% (2023: 25.79%) of Myer Holdings Limited (“MYR”), a company incorporated in Australia whose shares are quoted on the Australian Securities Exchange. The principal activities of MYR involves the operation of a number of department stores across Australia and through its online business. The Group commenced equity accounting for its investment in MYR from 13 December 2022. As at 27 July 2024, the carrying amount of the Group’s investment in MYR for the year was $161,031,710 (2023: $125,107,876), and the fair value of the Group’s interest in MYR as determined based on the quoted market price was $215,302,030 (2023: $137,666,934). There were no impairment losses relating to the investment in MYR and no capital commitments or other commitments relating to the associate. The Group’s share of the profit after tax in its investment in MYR for the year was $12,253,539 (2023: from 13 December 2022 to 29 July 2023: $2,694,541). During the period, a loss of $1,586,354 (29 July 2023: nil) was recorded in the profit and loss resulting from an issue of shares by MYR, and the corresponding impact on the Group’s method of equity accounting. The Group received total dividends amounting to $9,457,331 during the year (2023: total dividends received: $21,639,000, of which $16,944,000 was recorded against the investment in associate, and $4,695,000 was recorded in Other Revenue, as this dividend was received prior to the equity accounting commencement date). The financial year end date of MYR is 27 July 2024. For the purpose of applying the equity method of accounting, the financial statements of MYR for the year ended 27 July 2024 have been used. The accounting policies applied by MYR in their financial statements materially conform to those used by the Group for like transactions and events in similar circumstances. Premier Investments Limited 68 CAPITAL INVESTED 19 INVESTMENTS IN ASSOCIATES (CONTINUED) Myer Holdings Limited (continued) The following table illustrates summarised financial information relating to the Group’s investment in MYR: EXTRACT OF MYR’S STATEMENT OF FINANCIAL POSITION 27 JULY 2024 $’000 29 JULY 2023 $’000 Current assets 584,400 585,400 Non-current assets 1,791,100 1,851,400 Total assets 2,375,500 2,436,800 Current liabilities 646,300 640,700 Non-current liabilities 1,474,200 1,555,600 Total liabilities 2,120,500 2,196,300 NET ASSETS 255,000 240,500 Group’s share of MYR net assets 79,994 62,025 EXTRACT OF MYR’S STATEMENT OF COMPREHENSIVE INCOME 27 JULY 2024 $’000 29 JULY 2023 $’000 Revenue 2,438,100 2,565,800 Profit after income tax 43,500 60,400 Other comprehensive income (200) (900) Group’s share of MYR profit after income tax 12,254 2,695 INVESTMENTS IN ASSOCIATES ACCOUNTING POLICY An associate is an entity over which the Group has significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies. The considerations made in determining significant influence are similar to those necessary to determine control over subsidiaries. The Group accounts for its investments in associates using the equity method of accounting in the consolidated financial statements. Under the equity method, the investment in the associates is initially recognised at cost. Thereafter, the carrying amount of the investment is adjusted to recognise the Group’s share of profit after tax of the associate, which is recognised in profit or loss, and the Group’s share of other comprehensive income, which is recognised in other comprehensive income in the statement of comprehensive income. Dividends received from the associate generally reduces the carrying amount of the investment. After application of the equity method, the Group determines whether it is necessary to recognise an impairment loss on its investment in an associate. At each reporting period, the Group determines whether there is objective evidence that the investment in the associate is impaired. If there is such evidence, the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value, then recognises the impairment loss in profit or loss in the statement of comprehensive income. Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 69 Annual Report 2024 CAPITAL STRUCTURE AND RISK MANAGEMENT CONSOLIDATED 2024 $’000 2023 $’000 20 NOTES TO THE STATEMENT OF CASH FLOWS (a) RECONCILIATION OF CASH AND CASH EQUIVALENTS Cash at bank and in hand 212,571 211,999 Short-term deposits 196,910 205,648 TOTAL CASH AND CASH EQUIVALENTS 409,481 417,647 (b) RECONCILIATION OF NET PROFIT AFTER INCOME TAX TO NET CASH FLOWS FROM OPERATIONS Net profit for the period after tax 257,922 271,078 Adjustments for: Depreciation and impairment 166,042 165,222 Share of profit of associates (42,411) (30,864) Loss on investments in associates from share issue 3,097 703 Dividends received from listed equity investment - (4,695) Borrowing costs 94 16 Net loss on disposal of property, plant and equipment 141 132 Share-based payments (benefit) expense (3,084) 7,207 Movement in cash flow hedge reserve (405) 344 Net exchange differences (783) 1,235 Changes in assets and liabilities: Increase in trade and other receivables (3,047) (1,652) Increase in other current assets (3,000) (2,743) Decrease (increase) in inventories 13,305 (6,765) Decrease (increase) in other financial assets 577 (490) Decrease in deferred tax assets 2,094 1,826 Decrease in provisions (844) (429) Increase in deferred tax liabilities 3,026 6,745 Increase (decrease) in trade and other payables 4,267 (3,680) Decrease in deferred income (2,250) (1,822) Increase (decrease) in income tax payable 12,389 (42,313) NET CASH FLOWS FROM OPERATING ACTIVITIES 407,130 359,055 Premier Investments Limited 70 CAPITAL STRUCTURE AND RISK MANAGEMENT CONSOLIDATED 2024 $’000 2023 $’000 20 NOTES TO THE STATEMENT OF CASH FLOWS (CONTINUED) (c) FINANCE FACILITIES Working capital and bank overdraft facility Used - - Unused - - - - Finance facility Used 69,000 69,000 Unused 50,000 100,000 119,000 169,000 Bank guarantee facility Used - - Unused - - - - Interchangeable facility Used 3,667 4,184 Unused 9,333 8,816 13,000 13,000 Total facilities Used 72,667 73,184 Unused 59,333 108,816 TOTAL 132,000 182,000 CASH AND CASH EQUIVALENTS ACCOUNTING POLICY Cash and cash equivalents in the statement of financial position comprise cash on hand and in banks, money market investments readily convertible to cash within two working days and short-term deposits with an original maturity of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. For the purposes of the statement of cash flows, cash and cash equivalents consist of cash and cash equivalents as defined above, net of outstanding bank overdrafts. Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 71 Annual Report 2024 CAPITAL STRUCTURE AND RISK MANAGEMENT CONSOLIDATED 2024 $’000 2023 $’000 21 INTEREST-BEARING LIABILITIES NON-CURRENT Bank loans* unsecured - - Bank loans ** secured 69,000 69,000 TOTAL INTEREST-BEARING LIABILITIES 69,000 69,000 * Bank loans are subject to a negative pledge and cross guarantee within the Just Group Ltd group. Premier Investments Limited is not a participant or guarantor of the Just Group Ltd financing facilities. ** Premier Investments Limited obtained bank borrowings amounting to $69 million. A $19 million borrowing is secured by a mortgage over Land and Buildings, representing the National Distribution Centre in Truganina, Victoria. This borrowing is repayable in full at the end of 5 years, being January 2027. Premier Investments Limited obtained a further $50 million borrowing which is secured by a mortgage over Land and Buildings, representing an office building in Melbourne, Victoria. This borrowing was refinanced and is repayable in full at the end of 5 years, being December 2026. (a) Fair values The carrying values of the Group’s current and non-current interest-bearing liabilities approximate their fair values. (b) Defaults and breaches During the current and prior years, there were no defaults or breaches on any of the loans. (c) Changes in interest-bearing liabilities arising from financing activities CONSOLIDATED 29 JULY 2023 $’000 CASH FLOWS $’000 OTHER $’000 27 JULY 2024 $’000 Non-current interest-bearing liabilities 69,000 - - 69,000 TOTAL INTEREST-BEARING LIABILITIES 69,000 - - 69,000 ‘Other’ includes the effect of the amortisation of the capitalised borrowing costs, which are amortised over the life of the facility. INTEREST-BEARING LIABILITIES ACCOUNTING POLICY Interest-bearing liabilities are initially recognised at the fair value of the consideration received net of issue costs associated with the borrowing. After initial recognition, such items are subsequently measured at amortised cost using the effective interest method. Amortised cost is calculated by taking into account any issue costs, and any discount or premium on settlement. Fees paid on the establishment of loan facilities are amortised over the life of the facility while on- going borrowing costs are expensed as incurred. Premier Investments Limited 72 CAPITAL STRUCTURE AND RISK MANAGEMENT CONSOLIDATED 2024 $’000 2023 $’000 22 CONTRIBUTED EQUITY Ordinary share capital 608,615 608,615 NO. (‘000) $‘000 (a) MOVEMENTS IN SHARES ON ISSUE Ordinary shares on issue 30 July 2023 159,225 608,615 Ordinary shares issued during the year (i) 433 - Ordinary shares on issue at 27 July 2024 159,658 608,615 Ordinary shares on issue 31 July 2022 158,993 608,615 Ordinary shares issued during the year (i) 232 - Ordinary shares on issue at 29 July 2023 159,225 608,615 Fully paid ordinary shares carry one vote per share and carry the rights to dividends. (i) A total of 433,799 ordinary shares (2023: 231,603) were issued in relation to the performance rights plan. (b) CAPITAL MANAGEMENT The Group’s objective is to ensure the entity continues as a going concern as well as to maintain optimal returns to shareholders. The Group also aims to maintain a capital structure that ensures the lowest cost of capital available to the Group. The capital structure of the Group consists of debt which includes interest-bearing borrowings, cash and cash equivalents and equity attributable to the equity holders of Premier Investments Limited, comprising of contributed equity, reserves and retained earnings. The Group operates primarily through its two business segments, investments and retail. The investments segment is managed and operated through the parent company. The retail segment operates through subsidiaries established in their respective markets and maintains a central borrowing facility through a subsidiary, to meet the retail segment’s funding requirements and to enable the Group to find the optimal debt and equity balance. The Group’s capital structure is reviewed on a periodic basis in the context of prevailing market conditions, and appropriate steps are taken to ensure the Group’s capital structure and capital management initiatives remain in line with the Board’s objectives. (c) EXTERNALLY IMPOSED CAPITAL REQUIREMENTS Just Group Ltd, a subsidiary of Premier Investments Limited, is subject to a number of financial undertakings as part of its financing facility agreement. These undertakings have been satisfied during the period. Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 73 Annual Report 2024 CAPITAL STRUCTURE AND RISK MANAGEMENT CONSOLIDATED 2024 $’000 2023 $’000 23 RESERVES RESERVES COMPRISE: Capital profits reserve 464 464 Foreign currency translation reserve (a) 15,224 19,227 Cash flow hedge reserve (b) - 405 Performance rights reserve (c) 31,436 34,520 Fair value reserve (d) (28,920) (28,920) TOTAL RESERVES 18,204 25,696 (a) FOREIGN CURRENCY TRANSLATION RESERVE Nature and purpose of reserve Reserve is used to record exchange differences arising from the translation of the financial statements of foreign subsidiaries. - Movements in the reserve Opening balance 19,227 8,604 Foreign currency translation of overseas subsidiaries (339) 5,814 Net movement in associate entities’ reserves (3,664) 4,809 CLOSING BALANCE 15,224 19,227 (b) CASH FLOW HEDGE RESERVE Nature and purpose of reserve Reserve records the portion of the gain or loss on a hedging instrument in a cash flow hedge that is determined to be an effective hedge. - Movements in the reserve Opening balance 405 61 Net gain (loss) on cash flow hedges 168 (229) Transferred to statement of financial position/ profit or loss (746) 720 Deferred income tax movement on cash flow hedges 173 (147) CLOSING BALANCE - 405 Premier Investments Limited 74 CAPITAL STRUCTURE AND RISK MANAGEMENT CONSOLIDATED 2024 $’000 2023 $’000 23 RESERVES (CONTINUED) (c) PERFORMANCE RIGHTS RESERVE Nature and purpose of reserve Reserve is used to record the cumulative amortised value of performance rights issued to key senior employees, net of the value of performance shares acquired under the performance rights plan. - Movements in the reserve Opening balance 34,520 27,313 Share-based payment expense (reversal) (3,084) 7,207 CLOSING BALANCE 31,436 34,520 (d) FAIR VALUE RESERVE Nature and purpose of reserve Reserve is used to record unrealised gains and losses on fair value revaluation of listed equity investment at fair value. - Movements in the reserve Opening balance (28,920) (40,729) Unrealised gain on revaluation of listed investment - 29,165 Net Deferred income tax movement on listed investment - (17,356) CLOSING BALANCE (28,920) (28,920) 24 OTHER FINANCIAL INSTRUMENTS CURRENT ASSETS Derivatives designated as hedging instruments Forward currency contracts – cash flow hedges - 577 TOTAL CURRENT ASSETS - 577 (a) DERIVATIVE INSTRUMENTS USED BY THE GROUP (i) Forward currency contracts – cash flow hedges The majority of the Group’s inventory purchases are denominated in US Dollars. In order to protect against exchange rates movements, the Group manages its foreign currency exposure through a combination of forward exchange contracts, spot rate contracts, natural hedges resulting from US Dollar income from its wholesale channel, or utilising debt facilities to make US Dollar drawdowns. The forward currency contracts are considered to be highly effective hedges as they are matched against forecast inventory purchases and are timed to mature when payments are scheduled to be made. Any gain or loss on the contracts attributable to the hedge risk are recognised in other comprehensive income and accumulated in the hedge reserve in equity. Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 75 Annual Report 2024 CAPITAL STRUCTURE AND RISK MANAGEMENT 24 OTHER FINANCIAL INSTRUMENTS (CONTINUED) (a) DERIVATIVE INSTRUMENTS USED BY THE GROUP (CONTINUED) (i) Forward currency contracts – cash flow hedges (continued) At reporting date, the details of outstanding forward currency contracts are: CONSOLIDATED 2024 $’000 2023 $’000 2024 2023 Buy USD / Sell AUD NOTIONAL AMOUNTS $AUD AVERAGE EXCHANGE RATE Maturity < 6 months - 11,600 - 0.6896 Maturity 6 – 12 months - - - - Buy USD / Sell NZD NOTIONAL AMOUNTS $NZD AVERAGE EXCHANGE RATE Maturity < 6 months - 3,118 - 0.6466 Maturity 6 – 12 months - - - - OTHER FINANCIAL INSTRUMENTS AND HEDGING ACCOUNTING POLICY The Group uses derivative financial instruments such as forward currency contracts to hedge its foreign currency risks. These derivative financial instruments are initially recognised at fair value on the date on which the derivative contract is entered into and are subsequently remeasured at fair value at subsequent reporting dates. Derivatives are carried as financial assets when their fair value is positive and as financial liabilities when their fair value is negative. Any gains or losses arising from changes in the fair value of derivatives, except for those that qualify as cash flow hedges and are considered to be effective, are taken directly to profit or loss for the period. Cash flow hedges Cash flow hedges are hedges of the Group’s exposure to variability in cash flows that is attributable to highly probable future purchases as well as cash flows attributable to a particular risk associated with a recognised asset or liability that is a firm commitment and that could affect the statement of comprehensive income. The Group’s cash flow hedges that meet the strict criteria for hedge accounting are accounted for by recognising the effective portion of the gain or loss on the hedging instrument directly in other comprehensive income and accumulated in the cash flow hedge reserve in equity, while the ineffective portion due to counterparty credit risk is recognised in profit or loss. Amounts taken to equity are reclassified out of equity and included in the measurement of the hedged transaction (finance costs or inventory purchases) when the forecast transaction occurs. If the hedging instrument expires or is sold, terminated or exercised without replacement or rollover, or if its designation as a hedge is revoked (due to being ineffective), amounts previously recognised in equity remain in equity until the forecast transaction occurs. Premier Investments Limited 76 CAPITAL STRUCTURE AND RISK MANAGEMENT 25 FINANCIAL RISK MANAGEMENT POLICIES AND OBJECTIVES The Group’s principal financial instruments comprise cash and cash equivalents, derivative financial instruments, receivables, payables, bank overdrafts and interest-bearing liabilities. RISK EXPOSURES AND RESPONSES The Group manages its exposure to key financial risks in accordance with Board-approved policies which are reviewed annually and includes liquidity risk, foreign currency risk, interest rate risk and credit risk. The objective of the policy is to support the delivery of the Group’s financial targets whilst protecting future financial security. The Group uses different methods to measure and manage different types of risks to which it is exposed. These include, monitoring levels of exposure to interest rate and foreign exchange risk and assessment of market forecasts for interest rate and foreign exchange prices. Liquidity risk is monitored through development of future cash flow forecast projections. CREDIT RISK The overwhelming majority of the Group’s sales are on cash terms with settlement within 24 hours. As such, the Group’s exposure to credit risk is minimal. Receivable balances are monitored on an ongoing basis with the result that the Group’s exposure to bad debts is not significant. There are no significant concentrations of credit risk within the Group and financial instruments are spread amongst a number of financial institutions. With respect to credit risk arising mainly from cash and cash equivalents and certain derivative instruments, the Group’s exposure to credit risk arises from default of the counter party, with a maximum exposure equal to the carrying amount of these instruments. Since the Group trades only with recognised creditworthy third parties, there is no requirement for collateral by either party. Credit risk for the Group also arises from financial guarantees that members of the Group act as guarantor. At 27 July 2024, the maximum exposure to credit risk of the Group is the amount guaranteed as disclosed in note 33. INTEREST RATE RISK The Group’s exposure to market interest rates relates primarily to its cash and cash equivalents that it holds and interest-bearing liabilities. At reporting date, the Group had the following mix of financial assets and liabilities exposed to variable interest rate risk that are not designated in cash flow hedges: CONSOLIDATED NOTES 2024 $’000 2023 $’000 Financial Assets Cash and cash equivalents 20 409,481 417,647 409,481 417,647 Financial Liabilities Bank loans AUD 21 69,000 69,000 69,000 69,000 NET FINANCIAL ASSETS 340,481 348,647 Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 77 Annual Report 2024 CAPITAL STRUCTURE AND RISK MANAGEMENT 25 FINANCIAL RISK MANAGEMENT POLICIES AND OBJECTIVES (CONTINUED) INTEREST RATE RISK (continued) Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Group’s objective of managing interest rate risk is to minimise the Group’s exposure to fluctuations in interest rates that might impact its interest revenue, interest expense and cash flow. The Group manages this by locking in a portion of its cash and cash equivalents into term deposits. The maturity of term deposits is determined based on the Group’s cash flow forecast. The Group manages its interest rate risk relating to interest-bearing liabilities by having access to both fixed and variable rate debt which can be drawn down. i) Interest rate sensitivity The following table demonstrates the sensitivity to a reasonably possible change in interest rates on the portion of cash and cash equivalents and interest-bearing liabilities affected. A 100 (2023:100) basis point increase and decrease in Australian interest rates represents management's assessment of the reasonably possible change in interest rates. The table indicates an increase or decrease in the Group’s profit after tax. POST-TAX PROFIT TO INCREASE (DECREASE) BY: Impacts of reasonably possible movements: 2024 $’000 2023 $’000 CONSOLIDATED +1.0% (100 basis points) 2,383 2,441 -1.0% (100 basis points) (2,383) (2,441) Significant assumptions used in the interest rate sensitivity analysis include: - Reasonably possible movements in interest rates were determined based on the Group’s current credit rating and mix of debt in Australian and foreign countries, relationships with financial institutions, the level of debt that is expected to be renewed as well as a review of the last two years’ historical movements and economic forecasters’ expectations. - The net exposure at reporting date is representative of what the Group was and is expecting to be exposed to in the next twelve months. - The sensitivity analysis assumes all other variables are held constant, and the change in interest rates take place at the beginning of the financial year and are held constant throughout the reporting period. FOREIGN OPERATIONS The Group has operations in Australia, New Zealand, Singapore, Hong Kong, Malaysia, The Republic of Ireland and the United Kingdom. As a result, movements in the Australian Dollar and the currencies applicable to these foreign operations affect the Group’s statement of financial position and results from operations. From time to time the Group obtains New Zealand Dollar denominated financing facilities from a financial institution to provide a natural hedge of the Group’s exposure to movements in the Australian Dollar and New Zealand Dollar (AUD/NZD) on translation of the New Zealand statement of financial position. In addition, the Group, on occasion, hedges its cash flow exposure to movements in the AUD/NZD. The Group also on occasion, hedges its cash flow exposure to movements in the AUD/SGD, AUD/GBP, AUD/MYR and AUD/EUR. Premier Investments Limited 78 CAPITAL STRUCTURE AND RISK MANAGEMENT 25 FINANCIAL RISK MANAGEMENT POLICIES AND OBJECTIVES (CONTINUED) FOREIGN CURRENCY TRANSACTIONS The Group has exposures to foreign currencies principally arising from purchases by operating entities in currencies other than their functional currency. Over 80% of the Group’s purchases are denominated in United States Dollar (USD), which is not the functional currency of any Australian entities or any of the foreign operating entities. The Group considers its exposure to USD arising from the purchases of inventory to be a long-term and ongoing exposure. In order to protect against exchange rate movements, the Group enters into forward exchange contracts to purchase US Dollars, from time to time. These forward exchange contracts are designated as cash flow hedges that are subject to movements through equity and profit or loss respectively as foreign exchange rates move. The Group’s foreign currency risk management policy provides guidelines for the term over which foreign currency hedging will be undertaken for part or all of the risk. This term cannot exceed two years. Factors taken into account include: - the implied market volatility for the currency exposure being hedged and the cost of hedging, relative to long- term indicators; - the level of the base currency against the currency risk being hedged, relative to long-term indicators; - the Group’s strategic decision-making horizon; and - other factors considered relevant by the Board The policy requires periodic reporting to the Audit and Risk Committee, and its application is subject to oversight from the Chairman of the Audit and Risk Committee or the Chairman of the Board. The policy allows the use of forward exchange contracts and foreign currency options. At reporting date, the Group had the following exposures to movements in the United States Dollar (USD), New Zealand Dollar (NZD), Singapore Dollar (SGD), Pound Sterling (GBP), Malaysian Ringgit (MYR), and Euro (EUR): 2024 CONSOLIDATED USD $’000 NZD $’000 SGD $’000 GBP $’000 MYR $’000 EUR $’000 FINANCIAL ASSETS Cash and cash equivalents 4,514 27,395 14,040 25,796 7,924 825 Trade and other receivables 4,678 - 29 - - - 9,192 27,395 14,069 25,796 7,924 825 FINANCIAL LIABILITIES Trade and other payables (44,015) (5,695) (131) (391) - - NET EXPOSURE (34,823) 21,700 13,938 25,405 7,924 825 Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 79 Annual Report 2024 CAPITAL STRUCTURE AND RISK MANAGEMENT 25 FINANCIAL RISK MANAGEMENT POLICIES AND OBJECTIVES (CONTINUED) FOREIGN CURRENCY TRANSACTIONS (CONTINUED) 2023 CONSOLIDATED USD $’000 NZD $’000 SGD $’000 GBP $’000 MYR $’000 EUR $’000 FINANCIAL ASSETS Cash and cash equivalents 163 30,240 21,120 24,378 8,548 990 Trade and other receivables 2,284 - 49 - - - Derivative financial assets 577 - - - - - 3,024 30,240 21,169 24,378 8,548 990 FINANCIAL LIABILITIES Trade and other payables 42,296 4,820 258 8,243 - - 42,296 4,820 258 8,243 - - NET EXPOSURE (39,272) 25,420 20,911 16,135 8,548 990 The Group has forward currency contracts designated as cash flow hedges that are subject to movements through other comprehensive income and profit or loss respectively as foreign exchange rates move (refer to Note 24). FOREIGN CURRENCY RISK The following sensitivity is based on the foreign exchange risk exposures in existence at the reporting date: POST-TAX PROFIT HIGHER/(LOWER) OTHER COMPREHENSIVE INCOME HIGHER/(LOWER) CONSOLIDATED Impacts of reasonably possible movements: 2024 $’000 2023 $’000 2024 $’000 2023 $’000 CONSOLIDATED AUD/USD + 10% 3,166 3,619 - (555) AUD/USD – 10.0% (3,869) (4,432) - 832 AUD/NZD + 10% (1,973) (2,311) - - AUD/NZD – 10.0% 2,411 2,824 - - AUD/SGD + 10% (1,267) (1,901) - - AUD/SGD – 10.0% 1,549 2,323 - - AUD/GBP + 10% (2,310) (1,467) - - AUD/GBP – 10.0% 2,823 1,793 - - AUD/MYR + 10% (720) (777) - - AUD/MYR – 10.0% 880 950 - - AUD/EUR + 10% (75) (90) - - AUD/EUR – 10.0% 92 110 - - Premier Investments Limited 80 CAPITAL STRUCTURE AND RISK MANAGEMENT 25 FINANCIAL RISK MANAGEMENT POLICIES AND OBJECTIVES (CONTINUED) FOREIGN CURRENCY RISK (CONTINUED) Significant assumptions used in the foreign currency exposure sensitivity analysis include: - Reasonably possible movements in foreign exchange rates were determined based on a review of the last two years historical movements and economic forecasters’ expectations. - The net exposure at reporting date is representative of what the Group was and is expecting to be exposed to in the next twelve months from reporting date. - The effect on other comprehensive income is the effect on the cash flow hedge reserve. - The sensitivity does not include financial instruments that are non-monetary items as these are not considered to give rise to currency risk. LIQUIDITY RISK Liquidity risk refers to the risk of encountering difficulties in meeting obligations associated with financial liabilities and other cash flow commitments. Liquidity risk management is ensuring that there are sufficient funds available to meet financial commitments in a timely manner and planning for unforeseen events which may curtail cash flows and cause pressure on liquidity. The Group keeps its short-, medium- and long-term funding requirements under constant review. Its policy is to have sufficient committed funds available to meet medium term requirements, with flexibility and headroom to make acquisitions for cash in the event an opportunity should arise. The Group has at reporting date, $212.6 million (2023: $212.0 million) cash held in deposit with 11am at call and the remaining $196.9 million (2023: $205.6 million) cash held in deposit with maturity terms ranging from 30 to 190 days (2023: 30 to 220 days). Hence management believe there is no significant exposure to liquidity risk at 27 July 2024 and 29 July 2023. The Group aims to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts and bank loans with a variety of counterparties. At reporting date, the remaining undiscounted contractual maturities of the Group’s financial liabilities are: CONSOLIDATED FINANCIAL YEAR ENDED 27 JULY 2024 FINANCIAL YEAR ENDED 29 JULY 2023 CONSOLIDATED MATURITY 0 - 12 MONTHS $’000 MATURITY > 12 MONTHS $’000 MATURITY 0 - 12 MONTHS $’000 MATURITY > 12 MONTHS $’000 FINANCIAL LIABILITIES Trade and other payables 120,509 - 127,264 - Bank loans 3,942 74,607 3,837 78,284 Lease liabilities 156,045 294,288 153,045 309,688 Forward currency contracts - - 14,718 - 280,496 368,895 298,864 387,972 Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 81 Annual Report 2024 CAPITAL STRUCTURE AND RISK MANAGEMENT 25 FINANCIAL RISK MANAGEMENT POLICIES AND OBJECTIVES (CONTINUED) FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES The Group measures financial instruments, such as derivatives and listed equity investments at fair value, at fair value at each reporting date. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place in either the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability, which is accessible to the Group. In determining the fair value of an asset or liability, the Group uses market observable data, to the extent possible. The fair value of financial assets and financial liabilities is based on market prices (where a market exists) or using other widely accepted methods of valuation. All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the following fair value hierarchy, based on the lowest level input that is significant to the fair value measurement as a whole: Level 1 – the fair value is calculated using quoted price in active markets for identical assets or liabilities. Level 2 – the fair value is estimated using inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices). Level 3 – the fair value is estimated using inputs for the asset or liability that are not based on observable market data. CONSOLIDATED FINANCIAL YEAR ENDED 27 JULY 2024 FINANCIAL YEAR ENDED 29 JULY 2023 LEVEL 1 LEVEL 2 LEVEL 3 LEVEL 1 LEVEL 2 LEVEL 3 $’000 $’000 $’000 $’000 $’000 $’000 FINANCIAL ASSETS Foreign Exchange Contracts - - - - 577 - There have been no transfers between Level 1, Level 2 and Level 3 during the financial year. At 27 July 2024 and 29 July 2023, the fair values of cash and cash equivalents, short-term receivables and payables approximate their carrying values. The carrying value of interest-bearing liabilities is considered to approximate the fair value, being the amount at which the liability could be settled in a current transaction between willing parties. Foreign exchange contracts are initially recognised in the statement of financial position at fair value on the date which the contract is entered into, and subsequently remeasured to fair value. Foreign exchange contracts are measured based on observable spot exchange rates, the yield curves of the respective currencies as well as the currency basis spread between the respective currencies. Premier Investments Limited 82 GROUP STRUCTURE 26 SUBSIDIARIES The consolidated financial statements include that of Premier Investments Limited (ultimate parent entity) and the subsidiaries listed in the following table. (* Indicates not trading as at the date of this report) ENTITY NAME COUNTRY OF INCORPORATION 2024 INTEREST 2023 INTEREST Kimtara Investments Pty Ltd Australia 100% 100% Premfin Pty Ltd Australia 100% 100% Springdeep Investments Pty Ltd Australia 100% 100% Prempref Pty Ltd Australia 100% 100% Metalgrove Pty Ltd Australia 100% 100% Just Group Limited Australia 100% 100% Just Jeans Group Pty Limited Australia 100% 100% Just Jeans Pty Limited Australia 100% 100% Jay Jays Trademark Pty Limited Australia 100% 100% Just-Shop Pty Limited Australia 100% 100% Peter Alexander Sleepwear Pty Limited Australia 100% 100% Old Blues Pty Limited Australia 100% 100% Kimbyr Investments Limited New Zealand 100% 100% Jacqui E Pty Limited Australia 100% 100% Jacqueline-Eve Fashions Pty Limited * Australia 100% 100% Jacqueline-Eve (Hobart) Pty Limited * Australia 100% 100% Jacqueline-Eve (Retail) Pty Limited * Australia 100% 100% Jacqueline-Eve (Leases) Pty Limited * Australia 100% 100% Sydleigh Pty Limited * Australia 100% 100% Old Favourites Blues Pty Limited * Australia 100% 100% Urban Brands Retail Pty Ltd * Australia 100% 100% Portmans Pty Limited Australia 100% 100% Dotti Pty Ltd Australia 100% 100% Smiggle Pty Limited Australia 100% 100% Just Group International Pty Limited * Australia 100% 100% Smiggle Group Holdings Pty Limited * Australia 100% 100% Smiggle International Pty Limited * Australia 100% 100% Peter Alexander International Pty Ltd Australia 100% - Peter Alexander Group Holdings Pty Ltd Australia 100% - Smiggle Singapore Pte Ltd Singapore 100% 100% Just Group International HK Limited* Hong Kong 100% 100% Smiggle HK Limited* Hong Kong 100% 100% Just Group USA Inc.* USA 100% 100% Peter Alexander USA Inc.* USA 100% 100% Smiggle USA Inc.* USA 100% 100% Just UK International Limited* UK 100% 100% Smiggle UK Limited* UK 100% 100% Peter Alexander UK Limited* UK 100% 100% Smiggle Ireland Limited Ireland 100% 100% ETI Holdings Limited* New Zealand 100% 100% Roskill Hill Limited* New Zealand 100% 100% RSCA Pty Limited* Australia 100% 100% RSCB Pty Limited* Australia 100% 100% Just Group Singapore Private Ltd * Singapore 100% 100% Peter Alexander Singapore Private Ltd * Singapore 100% 100% Smiggle Stores Malaysia SDN BHD Malaysia 100% 100% Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 83 Annual Report 2024 GROUP STRUCTURE 27 PARENT ENTITY INFORMATION The accounting policies of Premier Investments Limited, being the parent entity, which have been applied in determining the financial information shown below, are the same as those applied in the consolidated financial statements. 2024 $’000 2023 $’000 (a) Summary financial information Statement of financial position Current assets 252,847 276,578 Total assets 1,647,154 1,632,906 Current liabilities 1,192 9,873 Total liabilities 97,440 101,287 Shareholders’ equity Issued capital 608,615 608,615 Reserves: - Foreign currency translation reserve 10,862 14,504 - Performance rights reserve 31,436 34,520 Retained earnings 898,801 873,981 Net profit for the period 221,064 218,074 Other comprehensive loss for the period, net of tax 3,642 4,949 (b) Guarantees entered into by the parent entity The parent entity has provided no financial guarantees in respect of bank overdrafts and loans of subsidiaries (2023: $nil). The parent entity has also given no unsecured guarantees in respect of leases of subsidiaries or bank overdrafts of subsidiaries (2023: $nil). (c) Contingent liabilities of the parent entity The parent entity did not have any contingent liabilities as at 27 July 2024 (2023: $nil). (d) Contractual commitments for the acquisition of property, plant or equipment The parent entity did not have any contractual commitments to purchase property, plant and equipment as at 27 July 2024 or 29 July 2023. Premier Investments Limited 84 GROUP STRUCTURE 28 DEED OF CROSS GUARANTEE Pursuant to ASIC Corporations (Wholly-owned Companies) Instrument 2016/785, dated 17 December 2016, relief has been granted to certain wholly-owned subsidiaries in the Australian Group from the Corporations law requirements for preparation, audit and lodgement of financial reports. As a condition of this instrument, Just Group Limited, a subsidiary of Premier Investments Limited, and each of the controlled entities of Just Group Limited entered into a Deed of Cross Guarantee as at 25 June 2009. Premier Investments Limited is not a party to the Deed of Cross Guarantee. 29 RELATED PARTY TRANSACTIONS (a) PARENT ENTITY AND SUBSIDIARIES The ultimate parent entity is Premier Investments Limited. Details of subsidiaries are provided in note 26. CONSOLIDATED 2024 $ 2023 $ (b) COMPENSATION FOR KEY MANAGEMENT PERSONNEL Short-term employee benefits 4,928,201 5,038,290 Post-employment benefits 98,584 110,734 Share-based payments 932,390 4,553,671 TOTAL 5,959,175 9,702,695 (c) RELATED PARTY TRANSACTIONS WITH KEY MANAGEMENT PERSONNEL Mr. Lanzer is the managing partner of the legal firm Arnold Bloch Leibler. Group companies use the services of Arnold Bloch Leibler from time to time. Legal services totalling $3,221,654 (2023: $1,695,213), including Mr. Lanzer's Director fees, GST and disbursements were invoiced by Arnold Bloch Leibler to the Group, with $972,623 (2023: $234,282) remaining outstanding at year-end. The fees paid for these services were at arm's length and on normal commercial terms. Mr. Lanzer is a director of Loch Awe Pty Ltd. During the year, lease payments totalling $240,167 (2023: $240,167) including GST was paid to Loch Awe Pty Ltd, with $nil outstanding rent payments at year-end (2023: $nil). The payments were at arm’s length and on normal commercial terms.  Mr. Lew is a director of Voyager Distributing Company Pty Ltd. During the year, purchases totalling $18,821,591 (2023: $25,652,581) including GST have been made by Group companies from Voyager Distributing Co. Pty Ltd, with $3,101,224 (2023: $3,820,631) remaining outstanding at year-end. The purchases were all at arm’s length and on normal commercial terms. Mr. Lew is a director of Century Plaza Trading Pty. Ltd. The company and Century Plaza Trading Pty Ltd are parties to a Services Agreement to which Century Plaza Trading agrees to provide certain administrative services to the company to the extent required and requested by the company. The company is required to reimburse Century Plaza Trading for costs it incurs in providing the company with the services under the Service Agreement. The company reimbursed a total of $632,500 (2023: $434,500) costs including GST incurred by Century Plaza Trading Pty Ltd, with $nil (2023: $nil) outstanding at year-end. Ballook Pty Ltd is a company associated with Mr Lew. During the year, Just Group Limited entered into a property lease for warehousing space in Footscray. The lease commencement date was 1 July 2024, with an expiry date of 31 October 2026. The annual rent agreed to is $1,155,000 inclusive of GST, and Just Group Limited is responsible for all outgoings in relation to the area leased. The lease was entered into at arm’s length and on normal commercial terms. The lease is accounted for under AASB 16 Leases in the financial statements. Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 85 Annual Report 2024 OTHER DISCLOSURES CONSOLIDATED 2024 $ 2023 $ 30 AUDITOR’S REMUNERATION The auditor of Premier Investments Limited is EY (Australia). Amounts received, or due and receivable, by EY (Australia): Audit or review of the statutory financial report of the parent covering the group and auditing the statutory financial reports of any controlled entities 726,000 648,628 Other assurance services or agreed-upon-procedures under other legislation or contractual arrangements not required to be performed by the auditor 423,323 43,000 Other non-audit services - 12,669 SUB-TOTAL 1,149,323 704,297 Amounts received, or due and receivable, by overseas member firms of EY (Australia) for: Audit of the financial report of any controlled entities 213,000 210,000 Other non-audit services 1,650 - TOTAL AUDITOR’S REMUNERATION 1,363,973 914,297 31 SHARE-BASED PAYMENT PLANS (a) RECOGNISED SHARE-BASED PAYMENT EXPENSE (BENEFIT) CONSOLIDATED 2024 $’000 2023 $’000 TOTAL EXPENSE (BENEFIT) ARISING FROM EQUITY- SETTLED SHARE-BASED PAYMENT TRANSACTIONS (3,084) 7,207 (b) TYPE OF SHARE-BASED PAYMENT PLANS Performance rights The Group grants performance rights to executives, thus ensuring that the executives who are most directly able to influence the Group’s performance are appropriately aligned with the interests of shareholders. A performance right is a right to acquire one fully paid ordinary share of the Group after meeting pre-determined performance conditions. These performance conditions have been discussed in the Remuneration Report section of the Directors’ Report. The fair value of the performance rights has been calculated as at the respective grant dates using an appropriate valuation technique. The valuation model applied, being either the Monte-Carlo simulation pricing model or the Black-Scholes European pricing model, is dependent on the assumptions underlying the performance rights granted to ensure these are appropriately factored into the determination of fair value. In determining the share-based payments expense for the period, the number of instruments expected to vest has been adjusted to reflect the number of executives expected to remain with the Group until the end of the performance period. Premier Investments Limited 86 OTHER DISCLOSURES 31 SHARE-BASED PAYMENT PLANS (CONTINUED) (b) TYPE OF SHARE-BASED PAYMENT PLANS (CONTINUED) Performance rights (continued) The following table shows the share-based payment arrangements in existence during the current and prior reporting periods, as well as the factors considered in determining the fair values of the performance rights in existence: GRANT DATE (DD/MM/YYYY) NUMBER OF RIGHTS GRANTED SHARE ISSUE PRICE OPTION LIFE DIVIDEND YIELD VOLATILITY RISK-FREE RATE FAIR VALUE 01/05/2020 544,809 $13.21 2.5 – 4 years 3.5% 36% 0.40% $8.33 02/12/2021 600,000 $30.58 3 – 6 years 3.6% 24% 0.87% $17.40 02/12/2021 200,000 $30.58 1 – 4 years 3.6% 24% 0.81% $27.25 01/07/2022 67,265 $22.30 1 – 3 years 3.6% 30% 2.32% $20.66 24/10/2022 165,000 $23.30 3 – 5 years 3.9% 25% 3.73% $19.98 27/10/2022 455,340 $24.08 3 – 5 years 3.9% 25% 3.47% $11.21 16/08/2023 25,000 $21.98 1 year 4.23% 25% 3.97% $21.11 (c) SUMMARY OF RIGHTS GRANTED UNDER PERFORMANCE RIGHTS PLANS The following table illustrates the number (No.) and weighted average exercise prices (“WAEP”) of, and movements in, performance rights issued during the year: 2024 No. 2024 WAEP 2023 No. 2023 WAEP Balance at beginning of the year 1,776,965 - 1,412,074 - Granted during the year 50,000 - 620,340 - Exercised during the year (i) (433,799) - (231,603) - Forfeited during the year (831,386) - (23,846) - Balance at the end of the year 561,780 - 1,776,965 - (i) The weighted average share price at the date of exercise of rights exercised during the year was $26.13 (2023: $24.42). Since the end of the financial year and up to the date of this report, no performance rights have been exercised. 700,000 performance rights have lapsed due to performance conditions not being met. (d) WEIGHTED AVERAGE FAIR VALUE The weighted average fair value of performance rights granted during the year was $25.96 (2023: $13.54). SHARE-BASED PAYMENT ACCOUNTING POLICIES The Group provides benefits to its employees in the form of share-based payments, whereby employees render services in exchange for rights over shares (equity-settled transactions). The plan in place to provide these benefits is a long-term incentive plan known as the performance rights plan (“PRP”). The cost of these equity-settled transactions with employees is measured by reference to the fair value of the equity instrument at the date at which they are granted. The cost of equity-settled transactions is recognised in profit or loss, together with a corresponding increase in equity, over the period in which the performance and/or service conditions are fulfilled (the vesting period), ending on the date on which the relevant employees become fully entitled to the award (the vesting date). Notes to the Financial Statements continued For the 52 weeks ended 27 July 2024 and 29 July 2023 87 Annual Report 2024 OTHER DISCLOSURES 31 SHARE-BASED PAYMENT PLANS (CONTINUED) SHARE-BASED PAYMENT ACCOUNTING POLICIES (continued) At each subsequent reporting date until vesting, the cumulative charge to profit or loss in the statement of comprehensive income is the product of: the grant date fair value of the award, the extent to which the vesting period has expired, and the current best estimate of the number of awards that will vest as at the grant date. The charge to profit or loss for the period is the cumulative amount as calculated above less the amounts already charged in previous periods. There is a corresponding entry to equity. No expense is recognised for awards that do not ultimately vest, except for equity-settled transactions for which vesting is conditional upon a market or non- vesting condition. These are treated as vested, irrespective of whether or not the market or non-vesting condition is satisfied, provided that all other performance and service conditions are met. KEY ACCOUNTING ESTIMATES AND ASSUMPTIONS The fair value of share-based payment transactions is determined at the grant date using an appropriate valuation model, which takes into account the terms and conditions upon which the instruments were granted to key executives. The terms and conditions require estimates to be made of the number of equity instruments expected to vest. These accounting estimates and assumptions would have no impact on the carrying amounts of assets or liabilities within the next annual reporting period but may impact the share-based payment expense and performance rights reserve within equity. 32 EVENTS AFTER THE REPORTING DATE The Directors of Premier Investments Limited approved a final ordinary dividend in respect of the 2024 financial year. The total amount of the final ordinary dividend is $111,761,000 (2023: Final ordinary dividend of $95,675,000) which represents a fully franked dividend of 70 cents per share (2023: Final ordinary dividend of 60 cents per share). The dividend has not been provided for in the 2024 financial statements. 33 CONTINGENT LIABILITIES The Group has bank guarantees and outstanding letters of credit totalling $3,667,481 (2023: $4,183,609). Directors’ Declaration Premier Investments Limited 88 In accordance with a resolution of the Directors of Premier Investments Limited, I state that: In the opinion of the Directors: (a) the financial statements and notes of Premier Investments Limited for the financial year ended 27 July 2024 are in accordance with the Corporations Act 2001, including: (i) complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements, and (ii) giving a true and fair view of the consolidated entity’s financial position as at 27 July 2024 and of its performance for the financial year ended on that date, and (b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable. (c) in the opinion of the directors, as at the date of this declaration, there are reasonable grounds to believe that the members of the Closed Group will be able to meet any obligations or liabilities to which they are or may become subject, by virtue of the Deed of Cross Guarantee. (d) The consolidated entity disclosure statement (Appendix 1) required by section 295A of the Corporations Act 2001 is true and correct. Note 2(b) confirms that the financial statements also comply with International Financial Reporting Standards as issued by the International Accounting Standards Board. The Directors have been given the declaration by the Chief Financial Officer required by section 295A of the Corporations Act 2001 for the financial year ended 27 July 2024. On behalf of the Board Solomon Lew Chairman 24 September 2024 Consolidated Entity Disclosure Statement 89 Annual Report 2024 Appendix 1 – Consolidated Entity Disclosure Statement Bodies Corporate Tax Residency Entity Name Entity Type Country Incorporated Share Capital Australian or Foreign Foreign Jurisdiction Premier Investments Ltd Body Corp Australia n/a Australian n/a Kimtara Investments Pty Ltd Body Corp Australia 100% Australian n/a Premfin Pty Ltd Body Corp Australia 100% Australian n/a Springdeep Investments Pty Ltd Body Corp Australia 100% Australian n/a Prempref Pty Ltd Body Corp Australia 100% Australian n/a Metalgrove Pty Ltd Body Corp Australia 100% Australian n/a Just Group Limited Body Corp Australia 100% Australian n/a Just Jeans Group Pty Ltd Body Corp Australia 100% Australian n/a Just Jeans Pty Ltd Body Corp Australia 100% Australian n/a Jay Jays Trademark Pty Ltd Body Corp Australia 100% Australian n/a Just-Shop Pty Ltd Body Corp Australia 100% Australian n/a Peter Alexander Sleepwear Pty Ltd Body Corp Australia 100% Australian n/a Old Blues Pty Limited Body Corp Australia 100% Australian n/a Kimbyr Investments Limited Body Corp New Zealand 100% Foreign New Zealand Jacqui E Pty Limited Body Corp Australia 100% Australian n/a Jacqueline-Eve Fashions Pty Ltd Body Corp Australia 100% Australian n/a Jacqueline-Eve (Hobart) Pty Ltd Body Corp Australia 100% Australian n/a Jacqueline-Eve (Retail) Pty Ltd Body Corp Australia 100% Australian n/a Jacqueline-Eve (Leases) Pty Ltd Body Corp Australia 100% Australian n/a Sydleigh Pty Limited Body Corp Australia 100% Australian n/a Old Favourites Blues Pty Ltd Body Corp Australia 100% Australian n/a Urban Brands Retail Pty Ltd Body Corp Australia 100% Australian n/a Portmans Pty Limited Body Corp Australia 100% Australian n/a Dotti Pty Ltd Body Corp Australia 100% Australian n/a Smiggle Pty Limited Body Corp Australia 100% Australian n/a Just Group International Pty Ltd Body Corp Australia 100% Australian n/a Smiggle Group Holdings Pty Ltd Body Corp Australia 100% Australian n/a Smiggle International Pty Ltd Body Corp Australia 100% Australian n/a Peter Alexander Group Holdings Pty Ltd Body Corp Australia 100% Australian n/a Peter Alexander International Pty Ltd Body Corp Australia 100% Australian n/a Smiggle Singapore Pte Ltd Body Corp Singapore 100% Foreign Singapore Just Group International HK Ltd Body Corp Hong Kong 100% Australian n/a Smiggle HK Ltd Body Corp Hong Kong 100% Foreign Hong Kong Just Group USA Inc. Body Corp USA 100% Australian n/a Peter Alexander USA Inc. Body Corp USA 100% Australian n/a Smiggle USA Inc. Body Corp USA 100% Australian n/a Just UK International Ltd Body Corp UK 100% Australian n/a Smiggle UK Limited Body Corp UK 100% Foreign UK Peter Alexander UK Ltd Body Corp UK 100% Australian n/a Smiggle Ireland Ltd Body Corp Ireland 100% Foreign Ireland ETI Holdings Ltd Body Corp New Zealand 100% Australian n/a Roskill Hill Limited Body Corp New Zealand 100% Australian n/a RSCA Pty Ltd Body Corp Australia 100% Australian n/a RSCB Pty Ltd Body Corp Australia 100% Australian n/a Just Group Singapore Private Ltd Body Corp Singapore 100% Australian n/a Peter Alexander Singapore Pvt Ltd Body Corp Singapore 100% Australian n/a Smiggle Stores Malaysia SDN BHD Body Corp Malaysia 100% Foreign Malaysia Basis of preparation The consolidated entity disclosure statement has been prepared in accordance with subsection 295(3A)(a) of the Corporations Act 2001. The entities listed in the statement are Premier Investments Limited and all the entities it controls in accordance with AASB 10 Consolidated Financial Statements. The percentage of share capital disclosed for bodies corporate included in the statement represents the economic interest consolidated in the consolidated financial statements/voting interest controlled by Premier Investments Limited either directly or indirectly. Independent Auditor’s Report Premier Investments Limited 90 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation Ernst & Young 8 Exhibition Street Melbourne VIC 3000 Australia GPO Box 67 Melbourne VIC 3001 Tel: +61 3 9288 8000 Fax: +61 3 8650 7777 ey.com/au Independent audit or’s report t o t he members of Premier Invest ment s Limit ed Report on the audit of the financial report Opinion We have audited the financial report of Premier Investments Limited (the Company) and its subsidiaries (collectively the Group), which comprises the consolidated statement of financial position as at 27 July 2024 , the consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended, notes to the financial statements, including material accounting policy information, the consolidated entity disclosure statement and the directors’ declaration. In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including: a. Giving a true and fair view of the consolidated financial position of the Group as at 27 July 2024 and of its consolidated financial performance for the year ended on that date; and b. Complying with Australian Accounting Standards and the Corporations Regulations 2001. Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial report section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Key audit matters Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial report of the current year. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context. We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the financial report section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the financial report. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying financial report. Independent Auditor’s Report continued 91 Annual Report 2024 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation Carrying value of intangible assets Why significant How our audit addressed the key audit matter At 27 July 2024, the Group held $818.3 million in goodwill and indefinite-life brand names recognised from historical business combinations, representing 32% of total assets. As outlined in Note 18 of the financial report, the goodwill and brand names are tested by the Group for impairment annually. The recoverable amount of these assets was determined based on a value in use model referencing discounted cash flows of the retail segment for goodwill, and the casual wear, women’s wear and non-apparel cash generating units (CGUs) for brand names. The model contains estimates and significant judgements regarding future cash flow projections which are critical to the assessment of impairment, particularly forecast sales growth in the casual wear and women’s wear CGUs and discount rates applied. Significant assumptions used in the impairment testing referred to above are inherently subjective and in times of economic uncertainty the degree of subjectivity is higher than it might otherwise be. Changes in certain assumptions can lead to significant changes in the recoverable amount of these assets. Accordingly, given the significant judgements and estimates involved in assessing impairment of intangible assets we considered this a key audit matter. For the same reasons we consider it important that attention is drawn to the information in Note 18. Our audit procedures included the following: ► Assessed the application of the valuation methodologies applied. ► Evaluated whether the determination of CGUs was in accordance with Australian Accounting Standards. ► Agreed the cashflows within the impairment model to board approved cashflows. ► Considered the historical accuracy of the Group’s cash flow forecasting process. ► Compared the forecast cash flows used in the value in use model to the actual current year financial performance of the underlying CGUs for reasonability. ► Assessed key inputs being discount rates, relief from royalty rates and sales growth rates adopted in the value in use model including comparison to available market data for comparable businesses. ► Performed sensitivity analysis on key inputs and assumptions included in the forecast cashflows and impairment models including the discount rates, to assess the risk of the CGU carrying value exceeding the recoverable amount. ► Assessed the adequacy of the disclosures included in the financial report. Our valuation specialists were involved in the conduct of these procedures where required. Existence and valuation of inventory Why significant How our audit addressed the key audit matter As at 27 July 2024, the Group held $217.9 million in inventories. Inventories are held at several distribution centres, as well as at over 1,200 retail stores. As detailed in Note 10 of the financial report, inventories are valued at the lower of cost and net realisable value. The cost of finished goods includes a proportion of purchasing department costs, as well as freight, handling, and warehouse costs incurred to deliver the goods to the point of sale. Our audit procedures included the following: ► Assessed the application of valuation methodologies for compliance with Australian Accounting Standards. ► Selected a sample of inventory lines and recalculated cost based on supporting supplier invoices and assessed the allocation of costs absorbed from the purchasing department, freight and warehouse costs. ► Attended store inventory counts on a sample basis and assessed the stock counting process which addressed inventory quantity and condition. Premier Investments Limited 92 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation Why significant How our audit addressed the key audit matter Provisions are recorded for matters such as aged and slow-moving inventory to ensure inventory is recorded at the lower of cost and net realisable value. This requires a level of judgement with regard to changing consumer demands and fashion trends. Such judgements include the Group’s expectations for future sales and inventory mark downs. Accordingly, the existence and valuation of inventory was considered to be a key audit matter. ► For all distribution centres with a material inventory balance, attended stocktakes at or near 27 July 2024, performed test counts, and performed roll back or roll forward procedures to balance date. ► Assessed the basis for inventory provisions, including the rationale for recording specific provisions. In doing so we examined the ageing profile of inventory, considered how the Group identified specific slow-moving inventories, assessed future selling prices, including consideration of costs to sell, and historical loss rates. ► Tested the slow-moving inventory reports for accuracy and completeness. ► Considered the completeness of inventory provisions by identifying mark down sales at or subsequent to year end. Accounting for leases Why significant How our audit addressed the key audit matter The Group holds a significant volume of leases by number and value over retail sites as a lessee. The recognition and measurement of new and remeasured lease agreements executed during the year in accordance with AASB 16 Leases (“AASB 16”) are dependent on a number of key judgements and estimates. These include: ► The calculation of incremental borrowing rates; ► The treatment of the option to extend the lease term under holdover; and ► The impact of backdated rent variations. Accordingly, given the significant judgements and estimates involved we considered this a key audit matter. Our audit procedures included the following: ► Assessed the mathematical accuracy of the Group’s AASB 16 lease calculation model. ► For a sample of leases, agreed the Group’s inputs in the AASB 16 lease calculation model in relation to those leases, such as, key dates, fixed and variable rent payments, renewal options and incentives, to the relevant terms of the underlying signed lease agreements. ► Assessed the accounting treatment applied to a sample of new and renegotiated lease agreements during the year, including the impact of backdated rental savings on the lease balances recognised. ► Considered the Group’s assumptions in relation to the treatment of the option to extend and lease term under holdover. ► Assessed the incremental borrowing rates used to discount future lease payments to present value. ► Assessed the adequacy of the disclosures included in the financial report. We assessed the Group’s calculations of the financial impact of the accounting standard and the accounting policies, estimates and judgements made in respect of the Group’s right of use assets and lease liabilities, as well as related depreciation and interest expense recognised through the Consolidated Statement of Comprehensive Income. Independent Auditor’s Report continued 93 Annual Report 2024 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation Information other than the financial report and auditor’s report thereon The directors are responsible for the other information. The other information comprises the information included in the Company’s 2024 annual report other than the financial report and our auditor’s report thereon. We obtained the directors’ report that is to be included in the annual report, prior to the date of this auditor’s report, and we expect to obtain the remaining sections of the annual report after the date of this auditor’s report. Our opinion on the financial report does not cover the other information and we do not and will not express any form of assurance conclusion thereon, with the exception of the Remuneration Report and our related assurance opinion. In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report, or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed on the other information obtained prior to the date of this auditor’s report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of the directors for the financial report The directors of the Company are responsible for the preparation of: ► The financial report (other than the consolidated entity disclosure statement) that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001; and ► The consolidated entity disclosure statement that is true and correct in accordance with the Corporations Act 2001; and for such internal control as the directors determine is necessary to enable the preparation of: ► The financial report (other than the consolidated entity disclosure statement) that gives a true and fair view and is free from material misstatement, whether due to fraud or error; and ► The consolidated entity disclosure statement that is true and correct and is free of misstatement, whether due to fraud or error. In preparing the financial report, the directors are responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so. Premier Investments Limited 94 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation Auditor’s responsibilities for the audit of the financial report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: ► Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. ► Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. ► Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. ► Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern. ► Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation. ► Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the financial report. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion. We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Independent Auditor’s Report continued 95 Annual Report 2024 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied. From the matters communicated to the directors, we determine those matters that were of most significance in the audit of the financial report of the current year and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. Report on the audit of the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included in pages 15 to 33 of the directors’ report for the year ended 27 July 2024. In our opinion, the Remuneration Report of Premier Investments Limited for the year ended 27 July 2024, complies with section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. Ernst & Young Glenn Carmody Partner Melbourne, Australia 24 September 2024 ASX Additional Shareholder Information As at 20 September 2024 Premier Investments Limited 96 TWENTY LARGEST SHAREHOLDERS NAME TOTAL % IC RANK CENTURY PLAZA INVESTMENTS PTY LTD 51,569,400 32.30% 1 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED 29,513,717 18.49% 2 J P MORGAN NOMINEES AUSTRALIA PTY LIMITED 24,978,912 15.65% 3 CITICORP NOMINEES PTY LIMITED 13,117,971 8.22% 4 METREPARK PTY LTD 8,235,331 5.16% 5 SL SUPERANNUATION NO 1 PTY LTD 4,437,699 2.78% 6 LINFOX SHARE INVESTMENT PTY LTD 2,577,014 1.61% 7 BNP PARIBAS NOMINEES PTY LTD 2,061,972 1.29% 8 BNP PARIBAS NOMS PTY LTD 1,390,814 0.87% 9 ARGO INVESTMENTS LIMITED 1,250,000 0.78% 10 NATIONAL NOMINEES LIMITED 1,234,589 0.77% 11 UBS NOMINEES PTY LTD 970,783 0.61% 12 MR CON ZEMPILAS 470,000 0.29% 13 GEOMAR SUPERANNUATION PTY LTD 450,000 0.28% 14 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED 303,818 0.19% 15 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED 289,364 0.18% 16 CITICORP NOMINEES PTY LIMITED 282,851 0.18% 17 BNP PARIBAS NOMINEES PTY LTD 273,000 0.17% 18 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED – A/C 2 238,077 0.15% 19 JOHN CHESTON 217,839 0.14% 20 TOTAL FOR TOP 20: 143,863,151 90.11% SUBSTANTIAL SHAREHOLDERS NAME TOTAL UNITS % IC CENTURY PLAZA INVESTMENTS PTY LTD AND ASSOCIATES 58,552,420 42.43% PERPETUAL LIMITED AND ITS SUBSIDIARIES 14,512,311 9.09% DISTRIBUTION OF EQUITY SHAREHOLDERS 1 TO 1,000 1,001 TO 5,000 5,001 TO 10,000 10,001 TO 100,000 100,001 TO (MAX) TOTAL Holders 7,633 2,332 279 179 33 10,456 Ordinary Fully Paid Shares 2,505,618 5,176,122 2,031,241 4,208,403 145,737,054 159,658,438 The number of investors holding less than a marketable parcel of 15 securities ($34.29 on 20 September 2024) is 233 and they hold 658 securities. VOTING RIGHTS All ordinary shares carry one vote per share without restriction. Corporate Directory 97 Annual Report 2024 A.C.N. 006 727 966 DIRECTORS Mr. Solomon Lew (Chairman) Dr. David M. Crean (Deputy Chairman) Mr. Timothy Antonie (Lead Independent Director) Ms. Sylvia Falzon Ms. Sally Herman Mr. Henry D. Lanzer AM Mr. Terrence L. McCartney Mr. Michael R.I. McLeod Ms. Andrea Weiss (appointed 4 December 2023) COMPANY SECRETARY Ms. Marinda Meyer REGISTERED OFFICE Level 7 417 St Kilda Road Melbourne Victoria 3004 Telephone (03) 9650 6500 WEBSITE AUDITOR Ernst & Young 8 Exhibition Street Melbourne Victoria 3000 SHARE REGISTER AND SHAREHOLDER ENQUIRIES Computershare Investor Services Pty Limited Yarra Falls 452 Johnston Street Abbotsford Victoria 3067 Telephone (03) 9415 5000 LAWYERS Arnold Bloch Leibler Level 21 333 Collins Street Melbourne Victoria 3000 Telephone (03) 9229 9999 www.premierinvestments.com.au EMAIL info@premierinvestments.com.au LAWYERS Arnold Bloch Leibler Level 21 333 Collins Street Melbourne Victoria 3000 Telephone (03) 9229 9999 This page is left blank intentionally.

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